GM Press release

GM Submits Plan for Long-Term Viability to the U.S. Congress (http://media.gm.com/servlet/GatewayServlet?target=http://image.emerald.gm.com/gmnews/viewpressreldetail.do?domain=827&docid=50755)

Market and Retail Operations – In the U.S., GM will focus its product development and marketing efforts on four core brands – Chevrolet, Cadillac, Buick and GMC. Pontiac will be a specialty brand with reduced product offerings within the Buick-Pontiac-GMC channel. Hummer has recently been put under strategic review, which includes the possible sale of the brand, and GM will immediately undertake a global strategic review of the Saab brand. As part of the plan, the company also will accelerate discussions with the Saturn retailers, consistent with their unique relationship, to explore alternatives for the Saturn brand[/URL][URL="http://media.gm.com/servlet/GatewayServlet?target=http://image.emerald.gm.com/gmnews/viewpressreldetail.do?domain=827&docid=50755"] (http://media.gm.com/servlet/GatewayServlet?target=http://image.emerald.gm.com/gmnews/viewpressreldetail.do?domain=827&docid=50755)

Compensation and Dividends – The plan calls for shared sacrifice, including further reduction in the number of executives and total compensation paid to senior leadership. For example, the chairman and CEO will reduce his salary to $1 per year. The plan also requires further changes in existing labor agreements, including job security provisions, paid time-off, and post-retirement health-care obligations. The common stock dividend will remain suspended during the life of the loans.

Looks like they're following Ford's lead. :p

Bigger company, bigger problems, bigger plans.

* End corperate jet travel
* Close 1.750 dealers
* $1 annual Salary for CEO Wagoner
* 50% pay cut for next top 4 executives.
* General Motors Oversight Board
* Cut 3.6 billion in annual hourly costs by 2012.
* Cut $7 billion in structural costs by 2012
* Shrink Pontiac to a niche high performance division ie: Corvette to Chevrolet
* Sell Hummer & Saab.
* Lilkely closing Saturn.

GM again is saying it can't survive without money this month (last week it was back up to mid year).

Robert Snell / The Detroit News
DETROIT -- General Motors Corp.'s plan asks Congress for up to $18 billion in emergency financial aid and, in return, offers to eliminate 30,000 jobs, shutter nine plants, reopen the United Auto Workers contract and either shrink, sell or possibly kill three additional brands.

The cuts range from symbolic -- ending corporate jet travel --to substantial -- closing 1,750 dealerships -- and are aimed at transforming one of America's largest and most storied companies into a leaner, profitable and more competitive automaker. Executives say the moves would make GM a viable company and help it survive the lowest per-capita sales level since World War II.

Chief Operating Officer Fritz Henderson said the automaker cannot continue to fund its operations unless it receives $4 billion this month.

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"There isn't a Plan B," he said.

GM's 37-page plan outlines cuts that otherwise would have been accomplished by filing bankruptcy, which would carry a stigma that would scare away shoppers. Those cuts include paying CEO Rick Wagoner a $1 salary, selling Saab, shrinking the Pontiac brand and talking to dealers about the future of Saturn.

The plan also explains how the automaker would spend the money and repay taxpayers by 2012. The plan includes deep cuts to a company that is bleeding cash and has lost almost $73 billion in the last four years despite several restructuring attempts, the most recent of which was undermined by the Wall Street crisis, lack of credit, unemployment and low consumer confidence.

GM is asking for $18 billion in financing, which includes a $12 billion loan and a $6 billion revolving line of credit that would be tapped if the market worsens.

The automaker would make several withdrawals of the cash in coming months. GM needs $4 billion this month to pay its bills and would draw $4 billion more in January.

GM would make a $2 billion withdrawal in February or March for a total of $10 billion. The remaining $2 billion would help ensure GM has enough cash to pay its bills through the end of next year, assuming an annualized sales rate of 12 million units.

The $6 billion line of credit could be tapped if the U.S. auto industry worsens to an annualized rate of 10.5 million units.

The automaker supports working with an oversight board that would ensure GM's restructuring goals are met and that the taxpayers' investment is "fully protected," Henderson said. The government would get stock at a certain price and if the value increases; shares could be sold at a profit.

GM warned that without government aid it could have just $1 billion in the bank by January and be $1.9 billion in the red by February if auto sales remain depressed.

"Absent such assistance, the company will default in the near term, very likely precipitating a total collapse of the domestic industry and its extensive supply chain, with a ripple effect that will have severe, long-term consequences to the U.S. economy," GM wrote in its report to Congress.

GM's plan involves the following moves:

• Slashing hourly costs in North America by $3.6 billion in an attempt to make GM competitive with foreign automakers no later than 2012.

The move, which will involve negotiating with the United Auto Workers to change wages and GM's obligations to a UAW-run health-care trust fund, includes eliminating up to 30,000 hourly and salaried workers.

GM currently has 96,000 workers and the goal is to have 65,000 to 75,000 workers by 2012.

GM wants to replace hourly workers with lower-paid workers. GM negotiated a two-tier wage system with the UAW last year that pays new hires $15 an hour (instead of $28) with no pensions and dramatic cuts to their health care coverage.

The contract also created a UAW-run trust fund -- known as the Voluntary Employee Beneficiary Association, or VEBA -- to relieve automakers of their nonsalaried health care costs. GM will contribute about $34 billion, which would cut its health care costs by $3 billion a year, beginning in 2010.

Henderson did not provide specific concessions it may seek from the UAW.

"I would prefer not to get into details," he said. "We need to deal with things like levels of manpower and jobs security."

One possible area is the controversial jobs bank that pays workers even when they are laid off.

The number of workers in the program has been thinned under tougher time restrictions in the 2007 contract but the benefit is derided as a relic of a bygone age that erodes the automakers' ability to compete and something they can no longer afford. UAW President Ron Gettelfinger recently said GM has removed about 47,000 workers in recent years.

In July, GM. announced it had won permission from the UAW to delay $1.7 billion in VEBA payments owed this year and 2009. GM will make the payments in 2010, when the UAW assumes responsibility for the fund. GM will pay the $1.7 billion, plus accrued interest of 9 percent adding to the $5.3 billion already scheduled for 2010.

GM also said it must get new concessions from hourly workers.

"GM has made mistakes in the past -- in now-untenable provisions from prior collective bargaining agreements, and insufficient investment in smaller, more fuel-efficient vehicles for the U.S," the plan said. "Even so, GM still supplies one in five vehicles sold in the U.S. today. In fact, 66 million GM cars and trucks are on this country's roads today, 44 million more than Toyota."

By 2012, GM proposes slashing its structural costs to $23.2 billion, about a $7 billion reduction.

GM's plan involves closing nine plants by 2012, which would leave the automaker with 38 plants in North America.

• Reducing or eliminating four of its eight brands and cutting the number of dealers.

The plan involves exploring the sale of Saab, talking to dealers about the future of Saturn and shrinking the Pontiac brand to more of a niche offering.

"Pontiac will be more of a high-value performance brand, like Corvette to Chevrolet," said Mark LaNeve, GM's North American vice president of sales.

GM established the Pontiac division in 1926 and Saturn in 1985.

Henderson would not speculate about what might happen to the Saturn brand, sales of which are down 20.9 percent this year.

"We need to do something...because it's not been successful," he said.

GM previously said it was trying to sell the Hummer brand.

The moves would let GM focus on four core brands: Chevrolet, Cadillac, Buick and GMC, which account for 83 percent of the company's sales.

The moves also would leave GM with 40 different models in 2012, eight fewer than it has currently. That compares to 63 models five years ago.

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. 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. 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.

By 2012, GM wants to eliminate 1,750 dealerships, particularly in metro and suburban areas. There are 6,450 dealers currently.

• Cutting executive compensation and eliminating its corporate aircraft fleet.

CEO Rick Wagoner will take a $1 salary next year, and GM is cutting the top four senior executives will see their cash compensation slashed 50 percent in 2009. Neither Wagoner nor top executives will receive bonuses this year or in 2009.

Wagoner already has seen his compensation cut in recent years and has not gotten a bonus in three of the last four years.

Wagoner had a $1.65 million salary in 2007 and has a $2.2 million salary this year. He took a 50 percent cut in pay in 2006, and his total compensation has been reduced sharply since he took the helm of GM in 2000.

GM announced it is closing its aircraft operations at Detroit Metropolitan Airport and getting rid of its airplanes --a thorny issue that drew scorn from lawmakers last month when Wagoner and CEOs from Ford Motor Co. and Chrysler LLC flew to Capitol Hill on corporate jets while asking for federal aid.

"Due to significant cutbacks over the past months, GM travel volume no longer justifies a dedicated corporate aircraft operation," the company said in a statement.

GM has given back two of its seven leased corporate jets, and is turning in two more -- and has sharply cut back on corporate travel.

The automaker is exploring options to transfer the remaining aircraft to another operator.

Instead of flying on corporate jets, GM executives and others will fly commercial or occasionally charter planes, Henderson said.

• Complying with the Energy Independence and Security Act of 2007, which was designed to improve fuel efficiency and cut dependence on foreign oil. GM outlined its current lineup of cars and crossover vehicles and plans to shift its portfolio towards producing even more of the fuel-efficient vehicles. For 2009, GM has 18 models in the U.S. that gets 30 mpg on the highway and that push towards more fuel-efficient vehicles will continue, Henderson said.

Wow, so it looks like Saab and Hummer will be sold and Saturn will probably be dumped.

The future relationship between Buick and Pontiac should be interesting, I'm not sure what to expect. G8 and Solstice only?

On Saturn, why not merge it into Chevrolet like they did with Geo?

On Saturn, why not merge it into Chevrolet like they did with Geo?

With the exception of the Sky, Chevrolet already has those products.

Neat trick.... I could have sworn I had my post on it's own thread. ;)

With the exception of the Sky, Chevrolet already has those products.

Very true. The next Cobalt replacement will be much like the Astra, the Aura is no better than the Malibu. Save the Sky, there isn't anything in the Saturn showroom that isn't at Chevrolet.

With the exception of the Sky, Chevrolet already has those products.


Very true. The next Cobalt replacement will be much like the Astra, the Aura is no better than the Malibu. Save the Sky, there isn't anything in the Saturn showroom that isn't at Chevrolet.
Which is why a merge with Chevrolet makes sense.

Sky could become the Chevy Stingray and branded as a niche vehicle along with Corvette, as was once rumored. (Afterall, even Pontiac as a niche brand within B-P-G is going to have at least 3 vehicles, so why not Corvette?)

Although Aura and Malibu are vastly similar, their styling is slightly different. As much as I love the Malibu's styling, the Aura's is closer to the GM global look, which helps GM's attempts to make Chevrolet more of a global brand.

Chevrolet would also get Saturn's no-haggle pricing model. Basically take what was working for Saturn, move it over to Chevrolet. Make Chevrolet more global and eliminate the duplicate models.

Which is why a merge with Chevrolet makes sense.

Sky could become the Chevy Stingray and branded as a niche vehicle along with Corvette, as was once rumored. (Afterall, even Pontiac as a niche brand within B-P-G is going to have at least 3 vehicles, so why not Corvette?)

Although Aura and Malibu are vastly similar, their styling is slightly different. As much as I love the Malibu's styling, the Aura's is closer to the GM global look, which helps GM's attempts to make Chevrolet more of a global brand.

The duplicate Saturns will be older models than their Chevrolet counter parts, so the Saturn versions will be dropped. Chevy Cruze is better than the Astra and Cobalt and the Sky will be on its 6th model year by the time that they can shut down Saturn. Chevy doesn't need a rebadged 6 year old car. They would be better off putting a 4 cyl. in the C7 Corvette (I doubt that would happen)



Chevrolet would also get Saturn's no-haggle pricing model. Basically take what was working for Saturn, move it over to Chevrolet. Make Chevrolet more global and eliminate the duplicate models.

Chevy could have done this any time over the past 20 years. There must be a good reason for them not to.

I really like that idea for Pontiac, but they can't seem to quit doing rediculous things with Pontiac... like G5, and G3, etc etc etc.

Make quality, DIFFERENT products, like G8 and Solstice, and let the Buick and GMC portion of the triple-line do the bigger volume stuff.

I like the Pontiac idea in concept...

Yeah right. Pontiac will become a specialty brand that sells "special" Pontiac G3s.

Unless they do something to drastically reduce the Pontiac dealer count, I can't see them changing much.

I'm glad the Saturn experiment is finally over. It's so refreshing that Fritz Henderson had the balls to just come out and say it's not working. That $15-$20 billion which Saturn soaked up, sure would come in handy now though.

I'm not quite sure what they mean by "shrinking" Pontiac and turning it into a niche brand. Does that mean kill the G6, G5 and G3 and just sell Solstices and G8's?
Or is code for, "don't expect any new products for Pontiac"?

I'm not quite sure what they mean by "shrinking" Pontiac and turning it into a niche brand. Does that mean kill the G6, G5 and G3 and just sell Solstices and G8's?All Pontiac needs is a G8 coupe to round out the line-up. With Solstice, G8 sedan, G8T and an added G8 coupe, would a "niche" brand really need more? Buick & GMC will handle the crossovers and SUVs. I suspect however, that they'll keep the G5 and G6 for now. G5 for the entry level B-P-G buyers, and G6 for those that watch Oprah. ;)

I'm not quite sure what they mean by "shrinking" Pontiac and turning it into a niche brand. Does that mean kill the G6, G5 and G3 and just sell Solstices and G8's?
Or is code for, "don't expect any new products for Pontiac"?

I'm curious about that myself. Will Buick be getting some kind of volume player that can pick up the slack of the G6?

I'm guessing that the reason that the decision was made not to go on with the Insignia as the next generation Aura was due to the fact that GM new then that Buick's days were numbered.

Sounds like we may be in for the Aura based "Regal" to go with the new LaCrosse.

I like the plan, alot. I just have a few questions.

1) is GMC gonna sell upscale trucks like the arcadia, or are they gonna go back to being high value commercial fleet trucks?

2) Aside from Buick being a chinese cash cow, isn't buick and caddillac still a little redundant? They are both luxury cars meant for older folks. Caddy's are just more expensive and nicer.

3) Which brand is gonna be the alt energy brand? Chevy? Are they gonna be the primary electric, hydrogen, hybrid supplier?

4) How extreme is poncho gonna go? Are they gonna limit themselves to G8's and solstices, or are they gonna keep the low 15 second eye candy like the G6 GTP coupe? (I've only seen like one of those on the road in my life, so prolly not)
With a now dedicated performance niche, would V8 RWD coupes be in the future development plan? (Dare I say it: GTO or Trans am?)

I
2) Aside from Buick being a chinese cash cow, isn't buick and caddillac still a little redundant? They are both luxury cars meant for older folks. Caddy's are just more expensive and nicer.



Buick will fill the gap between Chevy and Caddy. Cadillac will be farther upmarket than Buick. As it appears now, Opel and Buick will share styling and products. That works out well, since Opel has wanted to go upscale in Europe and now can be aligned with Buick for NA and Asia.

So if Pontiac is opened up to a niche product only that technically leaves the door open for sister car Firebird!

I like the whole plan in theory as it goes the extra painfully necessary step in bringing GM into a place for it to compete in this century. Seems as though this economy finally got GM to where Wall St. wanted them for quite some time.
The corp. jet thing still bugs me as it's just a Washington side show. Ask the Reps. how they get around and GM/Ford planes would look like American Eagle.

2) Aside from Buick being a chinese cash cow, isn't buick and caddillac still a little redundant? They are both luxury cars meant for older folks. Caddy's are just more expensive and nicer.

I wouldn't call Buick a "luxury" brand by any means, although they sell cars a notch or so above Pontiac and Chevy.

A "baby Buick" starting at say $22K could be more profitable than another Colbalt rebadge. Then you bring in the midsized Regal (Opel Insignia) and the upcoming LaCrosse as the "big" car starting at around $32K. (Just below the CTS.)

It's a risky strategy because Buick is practically on their deathbed, but it potentially could pay off a lot more than investing more into Saturn or Pontiac.

Buick will fill the gap between Chevy and Caddy. Cadillac will be farther upmarket than Buick. As it appears now, Opel and Buick will share styling and products. That works out well, since Opel has wanted to go upscale in Europe and now can be aligned with Buick for NA and Asia.

It would be nice to get the new 2009 Buick Regal (http://carscoop.blogspot.com/2008/11/new-buick-regal-opel-insignia-based.html) in the USA. Fills the midsize gap between the Malibu and CTS.

http://3.bp.blogspot.com/_FoXyvaPSnVk/SQ8lRMUlRjI/AAAAAAABBYw/eb4hlskv7nA/s1600/Buick-Regal-China-4.jpg

It would be nice to get the new 2009 Buick Regal (http://carscoop.blogspot.com/2008/11/new-buick-regal-opel-insignia-based.html) in the USA. Fills the midsize gap between the Malibu and CTS.

http://3.bp.blogspot.com/_FoXyvaPSnVk/SQ8lRMUlRjI/AAAAAAABBYw/eb4hlskv7nA/s1600/Buick-Regal-China-4.jpg


Considering that this very car was cancelled for Saturn, I'd bet on Buick getting it here.

It would be nice to get the new 2009 Buick Regal (http://carscoop.blogspot.com/2008/11/new-buick-regal-opel-insignia-based.html) in the USA. Fills the midsize gap between the Malibu and CTS.

http://3.bp.blogspot.com/_FoXyvaPSnVk/SQ8lRMUlRjI/AAAAAAABBYw/eb4hlskv7nA/s1600/Buick-Regal-China-4.jpg

We will.

So if Pontiac is opened up to a niche product only that technically leaves the door open for sister car Firebird!

I like the whole plan in theory as it goes the extra painfully necessary step in bringing GM into a place for it to compete in this century. Seems as though this economy finally got GM to where Wall St. wanted them for quite some time.
The corp. jet thing still bugs me as it's just a Washington side show. Ask the Reps. how they get around and GM/Ford planes would look like American Eagle.
The Reps get around on commercial airlines just like we do.

The CEOs going there on corperate airplanes to ask for money was simply stupid. Even I was beside myself when I heard that.

As far as Firebird, I wouldn't hold my breath unless it either is on the Alpha or the Commodore coupe gets the green light.

* Close 1.750 dealers

Is that suppose to be 1.750% of dealers or 1,750 dealers?

foxnews is hosting a pdf version of the "Plan"
http://www.foxnews.com/projects/pdf/GM_Plan.pdf

something that caught my eye... page 30 about half way down:
48% reduction in warranty repairs since 2006

holy crap!

although it does go to show that the quality turnaround didn't happen until very, very recently, there certainly has been a huge improvement based on that statistic.

too bad there really isn't any way to advertise that number without screaming "hey look we made ****ty cars but WE'RE OK NOW!"


edit:
although i just considered... how is this number derived? are there 48% fewer warranty repairs since 2006 because there are fewer cars sold? or is this an average RATE of warranty repairs?

edit2:
when did GM sell suzuki and isuzu? (page 31)

Funny how they went through and shrunk Buick to three models to reduce redundency, and now it is supposed to be the volume leader of the BPG pipeline? So are they just gonna rebadge all the Saturns as Buicks? Who under 50 buys a Buick anyway?

Has anyone compared the Ford and GM official plans? The GM version looks like they spent a LOT more time on it. Much more professionally note.

Also note that throught the documents, they capitalize "Plan". :confused:

Funny how they went through and shrunk Buick to three models to reduce redundency, and now it is supposed to be the volume leader of the BPG pipeline? So are they just gonna rebadge all the Saturns as Buicks? Who under 50 buys a Buick anyway?

Yeah, I'm confused about that too. Two years ago Saturn was the future and Buick was dead, and now they've reversed that. That's only about $3 Billion down the drain. Oops.

Changing their brand/model strategy every couple years is one of the major reasons GM is on the skids. From the customer's view it looks like they're playing russian roulette with their products. They need to come up with a long-term Plan and stick to it, if they intend on saving any of these brands.

Also, on second look, most of the brand changes proposed are heavy duty BS.

+ Sell Saab and Saturn -- nobody's going to buy them, and GM will be stuck with them. Eventually they will get new models, if GM survives.

+ Pontiac into a specialty brand -- this will last about 30 second until Chevy gets a new car and they need to placate the dealerships with a badgejob.

+ Buick as a volume brand -- aka GM is finally replacing the ancient W and H bodies, let's not get too excited.

Also, according to the PDF, they are only dropping 8 models by 2012. That's easily accounted for by Hummer and stuff that's already going out of production.

[QUOTE Sell Saab and Saturn -- nobody's going to buy them,QUOTE]

Saturn might gather some attention from some of the competition. Access to 400 more retail locations which are all newer showrooms. In addition, the brand has high customer satisfaction ratings.

The real question here is GM dumb enough to include in a Saturn sale the space frame tooling that they cluelessly arent using today. It would help another manufacturer achieve a series of flexible, lightweight, low cost, cafe friendly vehicles, quickly and at a relative low cost.

I could be way off base on thinking this, but does anyone else think that their plan isnt enough?

I mean, it would appear they have the chance here to really cut the fat off, and instead they're barely doing things..


Ok Sell Hummer and now saab.. ok so hummer was already for sale, saab barely sells many cars so is it really that much different?

Kill off Saturn. Ok good move.

Reduce Pontiac to a Niche? Your screwing the pooch. I dont see the need unfortunately anymore for pontiac, as much as I love their cars and history, it just doesnt make good business sense.

Buick, in the states, just why? should go bye bye as well.

GMC? keep? come on, axe it already too. Everything in its lineup is a Chevy anyways..

thats just my opinion.. i mean that would not only help with them getting approved for the loan,but also help in the long run with trimming the fat.


I could be way way off base t hinking its just not enough, but the plan doesnt seem "committed" enough to me.

Funny how they went through and shrunk Buick to three models to reduce redundency, and now it is supposed to be the volume leader of the BPG pipeline? So are they just gonna rebadge all the Saturns as Buicks? Who under 50 buys a Buick anyway?

Lets assume Buick gets the next Astra sedan and the Regal, add the Lacrosse. Those 3 vehicles will replace:
Saab 9-3
Saab 9-5
Pontiac G6 sedan
Pontiac G5
Pontiac Vibe?
Saturn Aura
Saturn Astra

So Buick expands by 2 models and GM cuts 7 models. Buick Delta II (next Astra?) would also give GM a more expensive and profitable small car.

It is a plan i guess. I really thought keeping Saturn and killing pontiac made more sense for the company.

Pontiac as a specialty niche brand makes no sense. The only thing that make well is Holdens, lol. Import a few Holdens as Holdens. I'll buy, already did.