GM Said to Study Shedding Saab, Saturn, Pontiac to Win U.S. Aid

[TTQ B4U]

WOW!

 

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=amIqBBYGRh5Q

Nov. 26 (Bloomberg) -- General Motors Corp., working to cut costs to win $12 billion in government loans, is studying whether to shed its Saturn, Saab and Pontiac brands in addition to Hummer, people familiar with the matter said.

 

Selling or dropping brands would save money and reduce overlap as the biggest U.S. automaker struggles to avoid running out of operating cash by year’s end, said the people, who didn’t want to be identified because no decision has been made. GM’s other U.S. brands are Chevrolet, GMC, Buick and Cadillac.

 

The review of the 82-year-old Pontiac division, one of GM’s earliest, shows the scope of the survival plan being given to Congress on Dec. 2 to show GM can repay federal aid. GM also seeks to cut debt levels and reduce costs for active and retired union workers, people have said.

 

Chief Executive Officer Rick Wagoner is under a deadline set by House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid. Congress has scheduled a Dec. 5 hearing on a $25 billion auto-industry rescue and may vote the week of Dec. 8.

 

A GM spokesman, Steve Harris, declined to comment on what may be included in the Detroit-based automaker’s plan.

 

Directors are scheduled to review a proposal Nov. 30 and Dec. 1, people familiar with the plans said. The automaker will prepare a 10- to 12-page public document and a private, more detailed plan of about 80 pages with background material, the people said. GM said Nov. 7 it may be short by year’s end of the $11 billion minimum in cash needed to pay monthly bills.

 

Prodding From Congress

 

Members of Congress such as Republican Senator Bob Corker Jr. of Tennessee have suggested the automakers might benefit from being able to shed some of their dealers.

 

GM’s eight U.S. brands are the most among the domestic automakers, compared with four at Ford Motor Co. and three at Chrysler LLC. The Hummer sport-utility vehicle unit was put on the block in June. GM agreed to eliminate the 103-year-old Oldsmobile brand in 2000 because of declining sales.

 

GM has 1,071 outlets for Pontiac, 400 for Saturn and about 105 for Saab among its 6,400 dealers, said Susan Garontakos, a spokeswoman. GM has been trying to combine Cadillac/Hummer/Saab and Pontiac/Buick/GMC brands into consolidated dealerships that would benefit from greater sales and lower marketing costs.

 

GM, which turned 100 this year, established the Pontiac division in 1926. The brand’s sales peaked at 896,980 in 1978, according to trade publication Automotive News. That was the year GM sold 9.55 million vehicles worldwide, the highest ever, and came at the end of an era when Pontiac attracted notice for sports coupes such as the Firebird.

 

This year, Pontiac sales are down 21 percent, compared with a 15 percent industrywide decline through October.

 

Very Surprised

 

Combining Buick, Pontiac and GMC dealerships has “been working very well,” said Randy Marion, owner of Randy Marion Chevrolet-Pontiac-Buick in Mooresville, North Carolina, and a member of GM’s National Dealer Council. “I would be very surprised if they had any intention of getting rid of Pontiac.”

 

GM established the Saturn brand in 1985, five years before selling the first vehicle. Most of the U.S. dealers are stand alone, according to GM. Sales reached a peak in 1994 at 286,003 units, according to Autodata Corp. in Woodcliff Lake, New Jersey. This year’s deliveries are down 19 percent.

 

GM made its initial investment in Sweden’s Saab in 1990 and took full control in 2000. Its sales climbed to a record 47,914 in 2003. In 2008, they’re down 31 percent through October.

 

Cash Burn

 

Declines across GM’s brands are adding to losses of almost $73 billion since the end of 2004. After burning through $6.9 billion in cash last quarter, GM said Nov. 7 that it had $16.2 billion as of Sept. 30. GM has said a bankruptcy filing would be a “disaster.”

 

GM gained $1.25, or 35 percent, to $4.81 at 4:15 p.m. in New York Stock Exchange composite trading.

 

The company’s 8.375 percent bonds due in July 2033 rose 5 cents to 19 cents on the dollar, yielding 43.9 percent, according to Trace, the bond-pricing service of the Financial Industry Regulatory Authority.

 

GM said Nov. 24 that its nine-year marketing accord with Tiger Woods, the world’s top-ranked golfer, will be discontinued next month by mutual agreement. GM has also delayed incentive payments to dealers, extended holiday shutdowns and announced plans to cut about 3,600 jobs early next year as production slows.

 

To contact the reporter on this story: Jeff Green in Southfield, Michigan at jgreen16@bloomberg.net; Greg Bensinger in New York at gbensinger1@bloomberg.net

Last Updated: November 26, 2008 16:44 EST

 

 

 

Discuss...

[Benner]

I could care less if they dropped Hummer, Saab, or Saturn but please please don't drop Pontiac.

[Cordell]

They can drop Pontiac for all I care, maybe then they'll import Holdens. Saab, Saturn, and Hummer are worthless anyway. I never understood why there is GMC and Chevy trucks, now Hummer is just boxes on those frames. All they need is Chevy, Cadilac, Buick, and bring in Holden.

[hot_wire]

I really hope they drop SAAB. These new chevy cobalt 9-3's suck my balls.

[Mallard]

I really hope they drop SAAB. These new chevy cobalt 9-3's suck my balls.

There's no such thing.

 

The 2003+ 9-3 "shares" a platform with the previous gen Malibu...although the only common part between them is the rear lower control arms.

 

I don't see any reason why Saab, Saturn, or Pontiac needs to go away. Saab should be Audi and Volvo competition, Saturn is commonizing everything with Opal (although I could see a case to combine that with Chevy), and Pontiac should be an American BMW. Each has their niche, and each has thier customer base. The number of vehicles they produce isn't the major problem, it's the number of dealerships. Combining dealerships is #1. Getting rid of brands would be secondary, because it's not going to be cheap. (It supposedly cost over $1 billion to get rid of Oldsmobile)

[Science Abuse]

I could care less if they dropped Hummer, Saab, or Saturn but please please don't drop Pontiac.

Then buy one, tell your freinds to do the same. No, your '98 doesn't count.

[hot_wire]

There's no such thing.

 

The 2003+ 9-3 "shares" a platform with the previous gen Malibu...although the only common part between them is the rear lower control arms.

 

Oops, said that without looking up my statistics. Looks like the 9-3 is on the Epsilon platform, rather than the cobalt's platform. Still, I feel like GM's influence has done little positive for the brand.

[MrMeanGreen]

Both of mine do. Get another Cougar and buy American, Eric

[pontiacfreak142]

I could deffinately see them getting rid of hummer and saab. For the rest of their brands, they just need to figure each one out, point it in one direction and leave it at that. Not have Buick getting high powered V8 variants, and not having pontiac getting crap like the vibe, torrent, G3, or G5 (especially since pontiac is the performance division and they dont even get a turbo version WTF..). Cadillac needs to be the BMW fighter.

[Dr. Apex]

Kinda funny with all this as a few years ago I read an article in Maxim about the number of dealerships each maker has and Toyota was selling more cars with 1/3 the dealers of GM, mind you this was probably 5+ years ago.

 

Don't know the source of the data or how accurate it was but seeing all this happens now makes me wonder why they weren't doing this years ago!!

[Nitrousbird]

All they need is Chevy, Cadilac, Buick, and bring in Holden.

Who in the flying fuck is buying a Buick?

 

I can't even grasp why Buick ISN'T on the chopping block. Another huge GM screw up. I am a GM supporter, know most of their lineup well, yet I honestly couldn't tell you what Buick sells anymore.

 

Saab is a Volvo competitor. Neither Saab nor Volvo are on the same levels as Audi, BMW, Benz, etc. Go try compareable models...it's how it is, period. And consumers agree.

 

Saab could be awesome, but needs a major re-vamp.

 

Buick needs to go away, as in stop production today, see ya.

 

GMC = get rid of them. Useless division.

 

Hummer....hmmm, that I'm iffy on. With gas prices how they are, I'm not sure where the truck markey stands in the next few months. In all honesty, I would like to see Hummer stay, but if they have to go, so be it.

 

Pontiac = a must keep. Chevy #1 keeper, obviously, with Caddy and Pontiac equal as #2. Pontiac does need to make itself even more unique from Chevy. Be the more sporty, "European"-ish division.

 

But getting rid of divisions isn't the real answer. Neither is gov't bailout money. The REAL answer is having the gov't force the UAW out. THAT will fix the problem.

[Cordell]

Buick is the great older person retiree car, I am looking forward to getting my Buick upon retirement.

Who the hell needs a Pontiac? G5, get a Cobalt. G6, get a Malibu. G8 should be absorbed into Chevy or Holden along with the Solstice/ Sky. Eliminate GMC, Hummer, Saturn, and Saab those cars are really pointless. Just expand the option list for the ramaining cars to include styling options among other things.

 

edit: The real discussion here is that there are too many dealerships. GM needs to combine all brands at the dealership level, as in go to your local GM dealer and buy any GM. Then close down 50% of all dealerships. A tough pill to swallow, but it would end excessive dealerships.

[Bigbird]

Who in the flying fuck is buying a Buick?

 

 

If I won the mega millions today, one of the first vehicles I would buy would be a Buick Enclave. Sure its the same as the GMC Acadia, Chevy Traverse, and Saturn Outlook. But I far and above like the looks of the Enclave better, and you can bet for damn sure it's got a better interior. It's one of the best vehicles I've ever driven. I would own one in a heartbeat if I could.

 

They really need to stop sharing vehicles so much, I understand that it cuts down on costs. But the G5 and Colbalt? Seriously? Come on GM you can do better than that. I'm all for getting rid of Saab...I hate em. The worst car I've ever driven was a Saab, I don't know exactly what it is. I just don't like them at all (sorry Saab owners, no offense to you). Getting rid of GMC would be good too. But Saturn and ESPECIALLY Pontiac should stay. I don't know why in the hell they would consider getting rid of Pontiac...

[Cordell]

. I don't know why in the hell they would consider getting rid of Pontiac...

Because it's the same reason they won't bring back the Trans Am, everyone likes them but not many buy them.

[Bigbird]

Because it's the same reason they won't bring back the Trans Am, everyone likes them but not many buy them.

 

 

Would you spend more money just to get a Camaro with a bird on it? I think not hahahaha. Hence why they need to stop the sharing bullshit. Or at least make a bigger differentiation between models.

[Bigbird]

The first part there was just agreeing with you Scott haha.

[Bigbird]

Triple cause I'm a lil bitch.

[Aaron]

They need to keep Chevy and Cadillac, Thats it.

 

CHEVY:

 

Fit/Versa fighter (Smaller better looking Astra with high MPG)

 

Civic/Corolla fighter (Redesigned Cobalt, with SS option)

 

Accord/Camry fighter (Malibu, with SS option)

 

G8 (maybe call it the Impala, with SS option(GXP))

 

Corvette

 

Camaro

 

CR-V/Rav-4 fighter (VUE type suv)

 

Traverse/Enclave etc

 

Tahoe/Suburban

 

A good midsize truck

 

Silverado (GMC looks with chevy badge)

 

Avalanche

 

CADILLAC:

 

Smaller 3 series/A4 car

 

CTS

 

DTS

 

Q5/X3 suv fighter

 

A Cadillac Enclave

 

Escalade/ESV/EXT

 

R8/Porsche 911 fighter (Cien concept years ago)

 

Thats it.

[copperhead]

Odd, I thought that Saturn was actually doing well.

 

Oh well, they really do need to cut out their redundancy. I never understood that, especially since the Japanese seemed to have killed off a lot of the old brand loyalty mentality. Short of the Mustang vs. F-Body guys, I hardly ever hear people anymore going on how x brand is teh bestast rawr. I know that even though I'm a toyota fan, I don't currently own a toyota, and I've owned something from nearly every major automaker.

[Science Abuse]

Both of mine do. Get another Cougar and buy American, Eric

It's up to them to sell me one. Fords new line up sucks. If I lived in Australia, I might feel differently. 390hp 5.4 DOHC in a RWD sedan, yes'please!

360hp Turbo straight 6 Falcon? I'll have 2 kthnxbai!

Imagine how their fiesta line would do here in the fuel-conscious states?

Fiesta XR4, 150hp, 140tq in a sub compact? That's fun enough for most.

[nurkvinny]

Redundancy is a good thing in a server world, not in the auto world.

 

Tahoe / Yukon

Chevelle / Le mans

Nova / (what was Pontiac's version)?

Sierra / Silverado

Eqionox / Vue / Enclave

Camaro / Firebird

Astro van / whatever GMC called theirs

S10 / S15

Blazer / Jimmy

Dodge / Chrysler Neons

Stratus / Cirrus

Envoy / Trailblazer

x100

[Mallard]

Who in the flying fuck is buying a Buick?

 

I can't even grasp why Buick ISN'T on the chopping block. Another huge GM screw up. I am a GM supporter, know most of their lineup well, yet I honestly couldn't tell you what Buick sells anymore.

The simple answer here is: China. Buick will never be killed in China, and in an effort to globalize all their brands, you will not see Buick killed here.

 

Saab is a Volvo competitor. Neither Saab nor Volvo are on the same levels as Audi, BMW, Benz, etc. Go try compareable models...it's how it is, period. And consumers agree.

But Saab NEEDS to be a VW/low-market Audi competitor. They offer good handling sport sedans with small displacement turbo engines and the option of FWD or AWD with and 'entry level luxury' interior trimmings and features. So you're sying a 9-3 can't compete with a Jetta? Puh-lease.

 

GMC = get rid of them. Useless division.

Agreed.

 

Hummer....hmmm, that I'm iffy on. With gas prices how they are, I'm not sure where the truck markey stands in the next few months. In all honesty, I would like to see Hummer stay, but if they have to go, so be it.

It needed to be a Jeep competitor, but the H2 ruined their street-cred with the green movement, while Jeep seems to have a huge following with those people (for some reason). They seem to love Wranglers, but most don't even know or care what an H3 is.

 

Pontiac = a must keep. Chevy #1 keeper, obviously, with Caddy and Pontiac equal as #2. Pontiac does need to make itself even more unique from Chevy. Be the more sporty, "European"-ish division.

Chevy - economical, well trimmed out FWD transportation. Like a Toyota.

Pontiac - entry level sports cars/sedans. RWD, nimble handling...an entry level American BMW.

Caddy - Follows the Pontiac strategy, but with a Mercedes-like luxury flair.

 

That's at least how I see it, and that's just how GM has been trying to make it for the last few years...it just takes a long time to change product at a car company.

[Mallard]

Kinda funny with all this as a few years ago I read an article in Maxim about the number of dealerships each maker has and Toyota was selling more cars with 1/3 the dealers of GM, mind you this was probably 5+ years ago.

 

Don't know the source of the data or how accurate it was but seeing all this happens now makes me wonder why they weren't doing this years ago!!

They've been doing it for years by combining Buick-GMC-Pontiac dealerships, but it's not the easiest thing to do because of the franchise owners. It costs a lot of money and doesn't happen over night.

[excell]

I was actually pondering this on a long drive yesterday, how weird. I decided that while I like Pontiac, it should be killed and consolidated with Chevy and Saturn. They really only offer two unique vehicles, the G8 and the Vibe. G8 should turn into the Impala and the Vibe should either be moved to Chevy or killed in favor of the Saturn Astra. The rest of the lineup should be axed, and the most popular Pontiac-only options on the G6 should be offered in it's Chevy and Saturn counterparts (I.E. convertible, three panel sunroof).

 

Hummer should be killed, and the new H3 truck hybrid thingie offered in GMC (with different sheet metal). Don't kill the GMT-360 (Trailblazer/Envoy), update it and offer a model in either Chevrolet or GMC but kill it's unibody brand mate (Acadia or Traverse).

 

Kill Buick in the U.S.A. and move it's most popular model to the Chevrolet or Cadillac brand.

 

Chevy and GMC need some differentiation in their truck and SUV lineups. More exotic vehicles like the Avalanche should be GMC-only, make GMC the cool truck professional during the week, play on the weekend 'foreman's' brand. Chevy should sell the vanilla 'workin' man trucks. Kill GMC vans, Chevy only.

 

Saab, IMO, is GM's most exciting brand - but only because of recent major changes. The public hasn't caught on yet. Keep running it more as a separate entity and don't mess with it, let it ride a few more years and see if they take off. Saab could very well be the new Buick, but a more exciting Buick that still engages old people but also draws the young urban professional.

[thorne]

they need to chop the duplicates. SAAB has some great turbo and awd options. Pontiac has the G8. I mean if you combined um all and just made them

 

 

Cadeviacs