Official: GM shrinking to four brands; Pontiac to four models

[mbfesta2009]

In an interview Sunday with Automotive News (sub. req'd), Troy Clarke, GM's North American president, said that General Motors will be able to make good on its promise to Congress to drastically cut costs. Clarke said that GM will now focus its "product and marketing resources" on Buick, Chevrolet, Cadillac and GMC. That would leave Pontiac, Saturn, Saab and HUMMER in automotive limbo. As part of that same plan presented to lawmakers, GM said it would sell or close Saturn. And since no one has yet stepped forward with cash, the future is not at all certain for the unique brand despite what GM's marketing VP Mark LaNeve says.

In a separate interview, Bob Lutz told AN that Pontiac will also have to get by with only four models: the G8, G5, Vibe and Solstice. Or five models if you count the Solstice coupe separately as Lutz does. Shrinking the brand would complete yet another promise GM made to Congress to make Pontiac a niche brand.

Link: http://www.autonews.com/apps/pbcs.dl...901119929/1197

[dengel]

Not to bust on you, as you are just reporting what was posted. But if GM is shrinking to four brands - Chevy, Caddy, Buick and GMC, then there would be no Pontiac to shrink to 4 models. So is the plan still to keep Pontiac but just not "focus on it"?

[dengel]

And BTW, I tried to read the full article at the link you provided, but it says I need to be a subscriber to access the article.

For those of use that don't subscribe to automotive news, can you post the rest of the content of the article for us? Or is what you posted all that was there?

[Koobie]

Check Autoblog.com, they have information on there as well.

It seems either way the Sky / Saturn brand is screwed. Tough break, but this was needed about 20 years ago.

[mbfesta2009]

Originally Posted by dengel Not to bust on you, as you are just reporting what was posted. But if GM is shrinking to four brands - Chevy, Caddy, Buick and GMC, then there would be no Pontiac to shrink to 4 models. So either the automotive media doesn't know whats going on, or GM executives are not in agreement yet on a final plan. Either way, I wouldn't call this "official word" from GM at this point.

I trust me I know what you mean I had the same question when I read it. I was thinking hmm 1..2...3...4.. Pontiac? I guess Pontiac doesn't count.

But I think the point is that their goal is to shrink to four brands. That Pontiac is going to stay with these four cars and see just what happens. And that the first ones on the chopping block are Hummer, Saab, and Saturn.

My fiance and I where talking about this and this is what I sent her:

So it looks like GM is cutting out everything other then Buick, Chevrolet, Cadillac and GMC. BIG mistake if you ask me. I think Cadillac and Buick are close enough that they should merge them into a single luxury class. I think Chevrolet and Pontiac are close enough that they should merge them into one premium class. GMC and Hummer only make trucks and we don't need just truck companies anymore so they should cut them. And I think Saturn should be dropped back to how they started a very cheap car to get the people who are looking for entry class low cost vehicles. I mean let's be realistic the cheapest Saturn today is about $16,000 when competitors are offering entry level cars in the $10,000 range. Now my rant about Pontiac. What is this about no more G6. I think that is a mistake if you ask me. So you can get a roadster, an economy car, a large sedan, or a wagon? Heck I say drop the G5 in favor of keeping the G6. The G5 is 2 door only, it's not as appealing in features, and the dealers tell me the G5 hardly sells. To me the G6 started showing the redesign of Pontiac and the improvements that they where to be making. Oh well hope GM knows what they are doing.

[MomsSol]

Well, here's a bit of good news from GM's own site posted yesterday:

GM Media Online

Near the end of the article:

GM also featured the 2009 Pontiac Solstice Coupe, equipped with a removable roof that enables an open-air driving experience yet offers a greater range of all-season driving opportunities; and the just-launched Opel Insignia midsize sedan, the European member of GM’s global family of midsize sedans. Insignia was recently named 2009 European Car of the Year by a panel of 59 auto journalists representing 23 countries.

If they were planning on doing away with Pontiac and/or the Solstice I don't believe they would be showcasing the Coupe at a major auto show!

[dengel]

Originally Posted by mbfesta2009 So it looks like GM is cutting out everything other then Buick, Chevrolet, Cadillac and GMC. BIG mistake if you ask me. I think Cadillac and Buick are close enough that they should merge them into a single luxury class. I think Chevrolet and Pontiac are close enough that they should merge them into one premium class. GMC and Hummer only make trucks and we don't need just truck companies anymore so they should cut them. And I think Saturn should be dropped back to how they started a very cheap car to get the people who are looking for entry class low cost vehicles. I mean let's be realistic the cheapest Saturn today is about $16,000 when competitors are offering entry level cars in the $10,000 range. Now my rant about Pontiac. What is this about no more G6. I think that is a mistake if you ask me. So you can get a roadster, an economy car, a large sedan, or a wagon? Heck I say drop the G5 in favor of keeping the G6. The G5 is 2 door only, it's not as appealing in features, and the dealers tell me the G5 hardly sells. To me the G6 started showing the redesign of Pontiac and the improvements that they where to be making. Oh well hope GM knows what they are doing.

I agree with you on keeping the G6 rather than the G5 under Pontiac. Isn't the G5 just a rebadged Chevy Cobalt? And I'm thinking it sells alot better as a Cobalt.

Regarding GMC, I do disagree with you on that. A lot of folks forget that the GMC brand is as much a seller of commercial vehicles as privately owned vehicles. I would think that they have some pretty steady sales of vehicles to commercial operations in need of hard-core work vehicles which they probably want to hold on to.

[Koobie]

Originally Posted by mbfesta2009 I trust me I know what you mean I had the same question when I read it. I was thinking hmm 1..2...3...4.. Pontiac? I guess Pontiac doesn't count. But I think the point is that their goal is to shrink to four brands. That Pontiac is going to stay with these four cars and see just what happens. And that the first ones on the chopping block are Hummer, Saab, and Saturn. My fiance and I where talking about this and this is what I sent her:

GM makes GOOD money on Buick in China. China is such an emerging market, it would be a bad idea to ignore the future profits there to ditch Buick.

The G6 should either get a heavier injection of sport, or go by the wayside, the G8 sets a new standard for family car performance in Pontiac, and the G6 should follow suit. The styling of the G6 is invisible as well, and what is worse, the coupe is a DIRECT RIPOFF of the Toyota Solara.

[PubliusE]

Originally Posted by dengel Regarding GMC, I do disagree with you on that. A lot of folks forget that the GMC brand is as much a seller of commercial vehicles as privately owned vehicles. I would think that they have some pretty steady sales of vehicles to commercial operations in need of hard-core work vehicles which they probably want to hold on to.

I agree with you on this. Sure GMC can do away with their rebadged Chevys but their heavy duty comercial trucks are made by no other division.

[MomsSol]

Originally Posted by mbfesta2009 In an interview Sunday with Automotive News (sub. req'd), Troy Clarke, GM's North American president, said that General Motors will be able to make good on its promise to Congress to drastically cut costs. Clarke said that GM will now focus its "product and marketing resources" on Buick, Chevrolet, Cadillac and GMC. That would leave Pontiac, Saturn, Saab and HUMMER in automotive limbo. As part of that same plan presented to lawmakers, GM said it would sell or close Saturn. And since no one has yet stepped forward with cash, the future is not at all certain for the unique brand despite what GM's marketing VP Mark LaNeve says. In a separate interview, Bob Lutz told AN that Pontiac will also have to get by with only four models: the G8, G5, Vibe and Solstice. Or five models if you count the Solstice coupe separately as Lutz does. Shrinking the brand would complete yet another promise GM made to Congress to make Pontiac a niche brand. Link: http://www.autonews.com/apps/pbcs.dl...901119929/1197

Ah ... but Bloomberg and Robert Wagner seem to disagree with this statement.

Bloomberg.com: U.S.

Jan. 12 (Bloomberg) -- General Motors Corp., the largest U.S. automaker, may keep Saturn as it undergoes a needed pruning of its brands, Chief Executive Officer Rick Wagoner said. “All the options with Saturn are on the table,” Wagoner said today in an interview on Bloomberg Television.

It appears they've updated the article from Automotive News now:

January 12, 2009 - 12:01 am ET UPDATED: 1/12/09 9:10 a.m. EST DETROIT -- General Motors, seeking buyers for Saab and Hummer, will be able to follow through with plans to shrink to four core brands, North American President Troy Clarke says. As part of the survival strategy submitted to Congress last month, GM said it intends to focus U.S. product and marketing resources on Buick, Chevrolet, Cadillac and GMC. On Sunday at the Detroit auto show, Clarke said the company will be able to execute the plan, even as the global credit crisis chills merger and acquisition activity. Subscribe to Automotive News "We have to re-engineer the way we're doing business in many regards," Clarke said. "We're going to be a smaller company." The automaker began a "strategic review" of the Hummer SUV line in June. Last week, GM sources told Automotive News that Sweden-based Saab has failed to attract suitors. Meanwhile, Pontiac will dwindle to a six-vehicle line, Vice Chairman Bob Lutz said here in a separate interview on Sunday. The cars: the G6, G8, G5, Vibe, Solstice and Solstice hardtop coupe. In the viability plan -- submitted as part of GM's effort to win $13.4 billion in federal bailout loans -- GM also said it would consider options for Saturn, without saying whether the line would be sold or shuttered. "We've entered into a very, very open and candid dialogue with our Saturn retailers,'' Clarke said. Saturn, launched 19 years ago, has been successful in terms of brand attributes, he said. But "it just hasn't been a good business for us." Saturn's only annual profit came in 1993. "We need some breakthrough options here," Clarke said. "We can't continue brands that have no prospect of earning their way." GM will be able to work within state franchise laws as it whittles its dealer count, Clarke said. GM has calculated the estimated costs, he said, without elaborating. In the viability plan it submitted to Congress, GM said it planned to go from 6,600 dealers to 4,700 by 2012.

[Koobie]

What is interesting is even if a product loses money, it sometimes is CHEAPER to keep making it than getting rid of it. The accountants will need to do some number crunching to figure it out, but they could actually justify Saturn's existence even though it loses money.

[mbfesta2009]

Ahh yes I guess to many of the points above there is some information lacking from my comments with my fiance. We where talking just about the US private market. I agree GMC should stay for the commercial side and the Buick name should stay around in China. In each market there is a name that does better than others. For instance Opel does well say Germany, but Vauxhaul does better in the UK, and Saturn is the more recognized name in the US. I can see where the trouble comes in here for GM but streamlining might not be a bad thing. I'm curious does anybody know how killing off Oldsmobile improved GM either on sales, profit, reducing expenses?

[MomsSol]

Originally Posted by Koobie What is interesting is even if a product loses money, it sometimes is CHEAPER to keep making it than getting rid of it. The accountants will need to do some number crunching to figure it out, but they could actually justify Saturn's existence even though it loses money.

Saturn is more than just a product. Clarke even said that the ONLY time Saturn turned a profit was 1993 - that was after only being around for 4 years - 15 years later they have yet to repeat the ONE TIME.

Don't know if the accountants will be able to convince Congress that Saturn is a viable entity with a track record of 1-18.

[achieftain]

The 4-brand label never appears in the original cited article and is only a grabber headline. Same with conflicting stories of continuance or demise of G6. It would definitely be sticking around if its conversion to rwd/awd would have taken place. Funny thing is, the new Opel Insignia is offered in awd and diesel versions as well - direct comp for the diesel 335. Actually, dropping the G6 is the ONLY way Pontiac's US sales volume can be caught by either Cadillac or Buick. Go figger.

[Koobie]

Originally Posted by MomsSol Saturn is more than just a product. Clarke even said that the ONLY time Saturn turned a profit was 1993 - that was after only being around for 4 years - 15 years later they have yet to repeat the ONE TIME. Don't know if the accountants will be able to convince Congress that Saturn is a viable entity with a track record of 1-18.

I wouldn't put much faith in GM's accountants on this one anyways. They had a several hundred million dollar "accounting adjustment" in the 2007 financials.

In the long run ditching Saturn is smart.