GM discussing axing another brand.

http://online.wsj.com/article/SB121384062220087331.html?mod=hpp_us_whats_news

GM Puts Off Truck,
SUV Redesigns
In New Focus
By JOHN D. STOLL
June 19, 2008; Page B1

General Motors Corp. is delaying the redesign of SUVs and full-size trucks as part of a wholesale review of its product and brand portfolio geared toward building lighter, fuel-efficient vehicles.

Smarting from the dramatic downshift in demand for its sport-utility vehicles and pickup trucks, General Motors is "looking at the whole product portfolio," spokesman Tom Wilkinson said late Wednesday. The shift in focus promises to puncture GM's North American profits and slow its revenue generation at least for the balance of 2008.

The entire U.S. auto industry is suffering as consumers, paying $4 per gallon for gasoline, shy away from heavier vehicles that burn more fuel than lighter, more-compact models.

Mr. Wilkinson said the company is considering how it can most effectively supply the U.S. market with fuel-efficient cars from its vast cupboard of global vehicle designs.

In the meantime, he said, the auto maker will extend the life cycle of its current lineup of pickups and SUVs. Those vehicles -- known as the GMT900 lineup -- include the Cadillac Escalade SUV and the Chevrolet Silverado pickup. The new generation of trucks and SUVs weren't slated to hit the market until at least 2012, but development of these products drains precious resources at a time when GM is battling to satisfy customer tastes.

In addition, Mr. Wilkinson said the company is evaluating how to market its products and make sure it has enough support to maintain the number of vehicle models it has in its lineup.

People briefed on the matter say the auto maker also has discussed killing off at least one future Hummer SUV product, and potentially axing another brand.

GM currently sells eight brands in the U.S., but earlier this month said it is conducting a strategic review of its Hummer brand, which is saddled with the kind of gas-guzzling image the Detroit auto maker is looking to shed. It also said it is closing four truck and SUV plants by 2010 in response to a massive decline in demand for such vehicles this year.

"There's an awful lot of discussion going on, and it's pretty fair to say everything is getting looked at," Mr. Wilkinson said.

He said GM is evaluating how to best tap the fuel-efficient small and mini cars it designs in Asia and Europe.

In coming months, GM will boost passenger-car production at a handful of factories in the U.S.

People briefed on the matter say the auto maker also has discussed killing off at least one future Hummer SUV product, and potentially axing another brand.

Anyone else reading that as GMC?

Anyone else reading that as GMC?

Don't know. I was thinking Hummer, if it's not sold.

Anyone else reading that as GMC?

It might be. The argument against killing GMC has always been that the lost sales wouldn't be regained by Chevy, but with the truck market heading downward so far, it'd be very tough to argue that GM needs two full-size truck brands just to sell 300-400K pickups each year.

As most Buick-Pontiac-GMC dealers are already combined, they could easily merge the three into one brand and "kill two birds with one stone". :p

As most Buick-Pontiac-GMC dealers are already combined, they could easily merge the three into one brand and "kill two birds with one stone". :p


And create the Buick-Saturn sales channel. :think:

And create the Buick-Saturn sales channel. :think:Actually, I think Saturn should be absorbed by Chevrolet. :D

And create the Buick-Saturn sales channel. :think:

Why not just make it the Buick channel? I still think Saturn and SAAB should be sold together.

Pontiac could become a trim package (ala Motorsport BMWs). GMC becomes a higher trim package for Chevrolet trucks.

Well...Lets look at it.

Chevy, Caddy and Saturn all have had major investment recently, and continued support.
Buick sells well in China, so axing or selling off Buick would hurt GM's presence in the largest growing car market.
GMC sells high profit trucks, and while the truck market is dying off or at least settling back to normal levels, they are still very profitable if GM can work GMC into a continued truck company to make trucks for the people that need them, the professional grade people. Plus combined with 2 other brands, they could cut down on the cost of dealers.
Hummer is a brand full of high profit, high price suv's, but they get poor gas milage and are a big target for envromentalists as well as a big hurt on the upcoming CAFE requirements. But you cannot deny its presence and outlandishness of its designs. It could be worth a lot to someone.
The only brand that seems to be the bastard child is Pontiac. While it has gotten a few cars here and there, all could be put into other divisions or are already sold by other divisions. Pontiac has no global reach, but its still GM's #2 best selling division.

Why not just make it the Buick channel? I still think Saturn and SAAB should be sold together.

Pontiac could become a trim package (ala Motorsport BMWs). GMC becomes a higher trim package for Chevrolet trucks.


Saturn-Saab is another interesting combo. I don't think Pontiac really has the cache to be an "M" division though.

Sell Saab and Hummer. Saturn is all overlap. They have great product, just like Olds did, but unfortunately it is all products sold by the other divisions. GMC is getting a Vue, and the Astra is nice but the 5 door overlaps with the Vibe. The 3 door Vibe would make a better G5. Saturn has 100% filled the roll of 2001 Oldsmobile.

I agree with selling Saab ... it's never been worth the $1+ billion GM paid for it, not even counting how much they've lost on it in the meantime. Only problem, who would want it? They might end up just giving it away (like BMW did with Rover) just to get rid of it.

Three years ago I would have said get rid of Saturn too, but then were given all this spiffy new product. However the new product isn't selling, so how much longer do you give them? I'd say a year, and if they aren't showing significant gains, then it becomes pretty apparent that nothing will save them and they should go.

I would get rid of Buick ... it has no relevance whatsoever in the North American market anymore. It doesn't matter that it does well in China; they are two totally different markets with mostly different cars. "Buick" is just a badge, and a worthless one in North America.

Pontiac I still think has a chance to carve out a distinctive niche in North America if they can quit appeasing the dealers with irrelevant crap like the G5 and Torrent. If GM doesn't have the balls to stay true to a brand's purpose, what's the point of even having separate brands?

GMC I'm on the fence about. It's relative cheap to maintain and quite profitable. A year ago I would have said keep it, but in the shrinking truck market it's definitely becoming harder to justify. I don't think it would make sense to keep it as a trim level on Chevy trucks (people would see right through that nonsense) so it would just plain go away, kinda like Fargo or Mercury trucks 30 years ago.

So in summary, Saab and Buick get the axe (Buick stays in China tho). Saturn has a year or so to turn itself around. And if the truck market doesn't stabilize soon, GMC also goes away.

GMC I'm on the fence about. It's relative cheap to maintain and quite profitable. A year ago I would have said keep it, but in the shrinking truck market it's definitely becoming harder to justify. I don't think it would make sense to keep it as a trim level on Chevy trucks (people would see right through that nonsense) so it would just plain go away, kinda like Fargo or Mercury trucks 30 years ago.

GMC is a cash cow, absolutely no reason to get rid of them while they still out sell every other GM brand with minimal investment. (except Chevy)

if they can quit appeasing the dealers with irrelevant crap like the G5 and Torrent

For this, I would get rid of rebadged Chevrolets (G5, G3) and allow Pontiac dealers to sell Chevrolet cars.

They should merge Chevy, Pontiac, Buick, and GMC into a single "GM" sales channel. That would eliminate all of the rebadges and poorly positioned models. And I don't think the customer group for any of these brands is really all that different from each other.

Also, they should take Saturn and Saab and hand over the management to the Europeans (similar to how VW/Audi operates). That would make their products more authentic and you wouldn't get obviously domestic stuff like the 9-7.

Well...Lets look at it.

Chevy, Caddy and Saturn all have had major investment recently, and continued support.
Buick sells well in China, so axing or selling off Buick would hurt GM's presence in the largest growing car market.
GMC sells high profit trucks, and while the truck market is dying off or at least settling back to normal levels, they are still very profitable if GM can work GMC into a continued truck company to make trucks for the people that need them, the professional grade people. Plus combined with 2 other brands, they could cut down on the cost of dealers.
Hummer is a brand full of high profit, high price suv's, but they get poor gas milage and are a big target for envromentalists as well as a big hurt on the upcoming CAFE requirements. But you cannot deny its presence and outlandishness of its designs. It could be worth a lot to someone.
The only brand that seems to be the bastard child is Pontiac. While it has gotten a few cars here and there, all could be put into other divisions or are already sold by other divisions. Pontiac has no global reach, but its still GM's #2 best selling division.


Forgetting about Saab there, I guess?

But killing Saab would make too much sense... I mean, after all, what would drain GM's pockets if we killed Saab?

Hummer could definetly go. The products aren't at all unique they could just add a "Hummer" trim to a few GMC models.

To me, it makes sense to make Saab and Saturn a division. Just import the euro cars with Saab being slightly more upscale so that both can have character and avoid the overlap, but that would require a big cash infusion.

Pontiac and Buick, I don't know. GM won't and or can't increase Cadillac's price point so I don't see how you have room for two passenger car brands when neither one should have more than about three products.

The 3 door Vibe would make a better G5.

You're crazy.

In addition, Mr. Wilkinson said the company is evaluating how to market its products and make sure it has enough support to maintain the number of vehicle models it has in its lineup.

They still can't do it right today, what makes them think they will get it right in the future? Ford seems to have a handle on it and at least Chrysler is advertising their new vehicles, even after they have been out for 1 year. With the disaster that is Saturn and Buick advertising right now, I would be amazed if anything changes for the better. Someone in GM marketing needs to be fired and quickly.

Also, on the brand being eliminated thing, I think GM should merge GMC with Chevy and sell off Pontiac, Buick, and Saturn. Seeing as Cadillac and Chevy are the only ones that can move vehicles, mostly thanks to the travesty that they call marketing at GM.

I agree with selling Saab ....Only problem, who would want it?
Tata? They'll buy anything. ;)

If we're going to have a domestic Opel brand anyway, I'd rather see Saturn killed and Pontiac become that division.

Pontiac as a brand is gravely damaged, but still has some heritage which could be revived. Saturn OTOH, is and has always been an empty suit.

GM won't sell SAAB. SAAB owners are brand loyal and I believe the brand has been profitable for GM in Europe.

Actually it makes more sense to axe Saab and or Saturn.

First, Saab is not a major player either here in North America nor abroad. They are not even very big in Europe. With a re-invigorated Cadillac I would much rather see luxury car development go there rather than a loser like Saab.

Second, Saturn was a big mistake from the beginning that never fully delivered. Add to that the fact it is a left-over from the Roger Smith era is enough to convince me to euthanize this brand. Also, when Chevy gets the Traverse then the only two models that Saturn would have that DON'T overlap with Chevrolet will be the Sky and the Astra. The Sky would make a nice Chevy Stingray and the Cobalt can take the place of the Astra anyway. Chevrolet was always GM's bread-and-butter brand and there is no sense in having Saturn take sales away from that.

It's hard to say which brand could get the axe. GMC is certainly worst suited for the times, but it still moves far more units than either Pontiac or Buick, for much less of an investment. This could change, but right now, I don't see how the dealers would swallow losing the backbone of their sales channel.

On the other hand, Pontiac is the most damaged at the moment. G8 is their only new product, and it is not doing well. And yet, it has a much brighter future than GMC as a car dominant brand.

No matter how you look at it, these are scary times for General Motors. It's really possible that they don't make it through this one.

The problem for these brands is that then need greater differentiation from Chevrolet (Pontiac-GMC) or Cadillac (Buick).

Buick can be set up to compete against the Asian luxury brands while Cadillac takes on the Europeans. Unfortunately, Buick still need significant product offering to thoroughly compete against the likes of Lexus and Infinity - time and money will be needed for this.

Pontiac should truly be the "Excitement Division". Why can't GM figure out how to do this when it is so obvious? Pontiac does not need a Vibe nor does it need a G5. It also does not need this alpha-numeric nomenclature. The G8 is a nice car and should have been called the Grand Prix and build it in North America. They should also give Pontiac a version of the Holden 60 Coupe concept. How about a properly designed GTO? The G8 Sport Truck is an interesting idea/take on the whole crossover segment. Why not add a really cool looking wagon and try to get people into that instead of SUVs?

GMC - here is a division that suffers from a lack of identity. You could argue that GM should have given Hummer-like vehicles to GMC instead of creating the Hummer brand to begin with. Why not make GMC the ultimate off-road and professional grade division? Take the Hummer H2, H2T, H3 and H3T, give these vehicles GMC styling and let the BPG channel prosper without having a Hummer brand to feed product to.

Also keep in mind that what GM needs is fewer, more profitable dealerships. I don't think Buick and Pontiac dealers are going to like it if they can't sell some trucks. Perhaps the truck/SUV bubble has burst, but there will always be truck buyers.

What happened to "Saturn has the most import conquest sales"?

People didn't think about the fact that they were buying a "craptacular American car," so it was easier to give up their Toyonda.

Pontiac should truly be the "Excitement Division". Why can't GM figure out how to do this when it is so obvious? Pontiac does not need a Vibe nor does it need a G5. It also does not need this alpha-numeric nomenclature. The G8 is a nice car and should have been called the Grand Prix and build it in North America. They should also give Pontiac a version of the Holden 60 Coupe concept. How about a properly designed GTO? The G8 Sport Truck is an interesting idea/take on the whole crossover segment. Why not add a really cool looking wagon and try to get people into that instead of SUVs?

.

I don't think anything G8 or Zeta based can save Pontiac. G8 sales have already started to slide. Pontiac needs a different formula to save it. That is, if it even can be saved.

There is very little evidence that Pontiac can move more expensive performance products.

I'd bet Pontiac would be a lot more successful positioned as an economy brand beneath Chevrolet. It would be a good place to put those minicars (Beat, Trax, etc). Kill the Aveo and sell it as the G3. Make the G5 a cheaper version of the Cobolt. The G6 and Vibe fit right in.

The G8 probably should have been badged as a Chevy in the first place.