• Nov 28th 2008 at 10:15AM
  • 83
When ants need to cross some dangerous span in order to get to the thing they want, certain ants in the colony will sacrifice themselves to build a bridge that other ants can cross. That's how you get the honey. In GM's case, the honey is a $12 billion government lifeline. The dangerous span is, well, extinction. And the sacrificial ants in this case could be Pontiac, Saturn, and Saab.

Before the government would start writing checks (to the automakers, at least), Congress told GM (and Ford and Chrysler) to come back with a plan that gave some indication of long-term viability and a return to financial health. Supposedly, as part of such a plan, GM has looked at "shedding" the three brands in question, which would eliminate the massive costs associated with production, marketing and sales. But that would happen after massive payouts, some serious upheaval and tens of thousands of job losses. It would leave GM with Chevrolet, GMC, Buick, and Cadillac... which, since it's in ruthless survival mode, makes us wonder what kind of crush GM has on GMC. GM will release a 10-to-12 page plan to the public making its case and Congress has scheduled a hearing on the matter for December 5th.

In the article, the word "shedding" is used to describe what GM would do with Saturn, Pontiac, and Saab. But we don't know where and how they would shed them. Saturn is a misfit child (not really Saturn's fault), Pontiac is unsure of itself (except when it comes to the G8 triplets and the Solstice), and Saab sold about 33,000 cars in America last year and 125,000 around the world. With the state of lending and credit markets, it would probably be easier to buy a pterodactyl than get a loan to buy one of GM's brands. HUMMER's already been on the block so long it's about to get arrested for loitering. So is "shedding" a euphemism for "bye-bye..."? We'll know soon enough. Thanks to all who tipped in.

[Source: Bloomberg]

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    • 1 Second Ago
      • 6 Years Ago
      Just a few points after reading some posts:

      GMC: Has a very long history and excellent reputation dealing with large companies and municipalities with their medium and heavy commercial lines, to try and establish this with Chevy after GMC were picked off would be disastorous, and a huge money loser. Also no one with a large contract wants to wait in line behind a guy getting an oil change on his Cobalt for service..which brings me to the point why some guys will buy GMC, but not Chevy trucks...number 1 answer...the dealer network.

      Pontiac: Althought there are purists out there for the brand, customer surveys reveal that 2/5 Pontiac buyers considered a Chevy, and 1/5 Chevy buyers considered a Pontiac, hence the brands are too competetive with each other and one has to go. Making Pontiac a specialty brand eliminates this without closing the brand completely.

      Saturn: again a few purists, but trapped in the same price point structure as Pontiac and Chevy. Other than the Astra, which isnt meeting expectations at all, offers rebadged vehicles which can be easily absorbed.

      Buick: considered a dead brand by some, some also consider it the most undervalued brand.While doing well in China, the major problem it has in the U.S. is the "old man car" image. Wasnt all that long ago Cadillac had the same problem that was turned around. If they can bring the Invicta, Riviera, and Excelle models over here they might have a shot. After all, there will always be people who dont want to plunk down the cash for a Cadillac, but consider a Chevy a too"common" car. Plus for GM to ax the only brand that has both tied and beat Lexus in quality would be stupid.
      • 6 Years Ago
      Man, if Saturn disappears I'm gonna be really sad. I love my 99 SC2 and I was really hoping they'd get past Opel-mania and bring back the S cars. If they disappear though I'll never see that dream come true.
      • 6 Years Ago

      "I do think that GM should use the G8 though and the G8 ST since that is all pontiac has that is worth anything. ...But the rest of the Saturns and Pontiac already overlap with other GM products so its not worth keeping them."

      What about the Vibe? There is no other GM equivalent to it, and it's their second best selling model, with October sales that are actually up 36% for October compared to last year (albeit partially due to a new model release).

      You guys keep talking G8 and Solstice, but that's not where the money is for GM. They need to sell higher volume cars, and the Vibe is a viable one.
      • 6 Years Ago
      I say keep GMC for that pro edge, Chevrolet for that blanket staple, and Cadillac to attack other performance and luxury brands. Buick I think is suppose to be more affordable Luxury minus the performance... Pontiac is suppose to be performance 24/7 but with poor badge engineering jobs like the G3 they're planning to release they keep stabbing the score board. So I guess they just better make sure they can effectively go after everyone without re-defining any of their brands further. And cut down on the easily identified badge engineering jobs or problems will persist.
      • 6 Years Ago
      Pontiac: damaged brand, crappy vehicles.. better interior than Chevy though. The Chevy brand should be overhauled as a result of this baliout so the Cobalt can get the same respect in 10 years, as the used Corollas get. The motor, the interior styling..everything. Discontinue the Daewoo Aveo (NOT a real Chevy!). Saturn.. they have lost steam. They used to be something unique.. not so much anymore. I say let that one go, but keep the Astra.. but sell it as an Opel.. which is what it really is. Bring Opel back to the US. Make sure that Opel's are different, and that Germans are designing the engine so it can fill that "I prefer German engineering" niche. Buick is great brand & the Enclave sells pretty well. Also build more vehicles in cheaper locations that are NOT in Mexico. many folks simply hate that, and the fact an Honda Accord is put together in Tennesee or wherever will justify their peurchase. Please check out Misissippi, Alabama, Arkansas, Oklahoma etc.. Cut executive salaries. Also, I have theory. Buliding cars/trucks in California may not be so bad, because of the amount of people that live here. Regardless of higher wages to be paid, if you are a local employer in a region that bought shitloads more japanese cars in comparison to Omaha, NE then becoming a fixture in that region may be beneficial over time. ..but you build the factory in Barstow of course..where it's cheap. If you do all this, then Toyota & Honda will not be so much of problem in the future, I promise you.
      • 6 Years Ago
      It should be Buick, not Pontiac, although Pontiac could do to lose a little weight.
      • 6 Years Ago
      Saturn dealerships are too few and far between. The two nearest dealerships are each more than 50 miles from my home town. Most people simply aren't going that far to buy a car, especially when their needs can be met by any number of GM dealerships within a few miles in any direction.
      • 6 Years Ago
      not to mention Hummer is still for sale...
      • 6 Years Ago
      Oddly enough, if GM were to shed those 3 brands, they would be great brands to for a buyer to work with. Imagine if, say, Nintendo or Apple (they've got enough capital is all I'm saying) bought them.

      Saturn: Everyday brand for Joe Sixpack
      Pontiac: Performance brand (more RWD vehicles)
      Saab: Premium Euro-style brand.

      Not bad IMO.
      • 6 Years Ago
      I would keep Saab just because GM is already having Opel build the next generation of Saab's in Germany and is an international brand. Pontiac, Hummer, GMC and Saturn should be discontinued and the Opel products integrated to the Chevy, Buick, Saab and Cadillac brands. We know Holden could supply large cars and Daewoo small vehicles while Opel mediums size and or supervise development from the GM foreign brands. GM at home should concentrate in trucks and commercial vehicles. We will see.
      • 6 Years Ago
      One more thing on dealers. I don't care about some poor chap's sad story about his 30yr old business shutting down - climate has changed, and he needs to go. He hopped onboard during the boom, made his money, made bad decisions, and now, well...what can I say..."too bad".

      I think the answer is hiding in plain sight - GM must stop depending on lower-to-middle class people to purchase their cheap, dildo-quality plastic interior, fuel inefficient cars. Do I mean that they need to abandon that market altogether? NO! They need to stop RELYING on it to produce necessary volume to make $1.

      *Kill GMC (something I've been saying since 2002)

      *Bring Saturn more in line with Opel, stop cheapening great cars, i.e. Astra/Insignia for US market.

      *Chevrolet needs to be a value brand, maybe on same level as Nissan or SEAT (which is underneath VW lineup).

      *Pontiac should be an enthusiast brand, kind of like Mazda. I think they could make it Mazda-ish, Mini-ish, with some Holden cars on upper end.

      *Hummer - kill it, but keep copyright to the name until highest bidder. (Same as with Rover involving BMW, Ford, SAAIC)

      *Saab, this is the one I wonder about. I think the brand can survive, but only if it they can give it a design language which is unmistakably Saab. It has to feel very Scandinavian, very restrained, classy, but not too conservative.

      *Cadillac - keep pushing is what they need to do, go after Mercedes, Maseratti, BMW, Audi and so forth. They MUST go upmarket, yes I know it's hard step to make and they are afraid, but this must be done, otherwise they risk devaluing the brand and causing horrid overlap throughout all of their divisions. CTS-V is a step in right direction, XLR is a good idea, but poorly executed.

      Last thoughts, GM must be more aggressive with UAW, throw out politics (protecting American jobs nonsense). GM is a business, it is a corporation, its sole purpose is to make money, not to provide welfare for those who decided to have kids and not go to college.

      How can GM get out of this? Bankruptcy - all current contracts with dealers, suppliers, UAW MUST MUST MUST MUST MUST be thrown out.
      • 6 Years Ago
      @ Autoblog:
      I've been a religious reader of this site for a while now, and I've gotta say, your constant advertising of stories like this is REALLY bugging me. I spoke with a source within GM and within Saturn last night who said that NOBODY with the exception of autoblog is considering selling Saturn, Pontiac, OR Saab!! At least attempt to verify your info with GM!

      While GM hasn't treated Saab as well as they should, Saabs are still (and have been for a while) REALLY fun cars! I own a 2003 9-5 (possibly the most boring looking Saab ever) and I love feeling the turbo! My little 4-cyl can keep up with a lexus GS!

      And one more thing....... Buick cannot die because it is the only brand doing exceptionally well in china (aka a HUGE expanding market). So buick won't go either.

        • 6 Years Ago

        Yes it was originally from Bloomberg, but considering Bloomberg's history I would know to take them with a grain of salt, or in this case, a heaping spoonful.
        But as far as I have seen, the folks at autoblog seem to tell it like it is, but lately any average joe would think of GM as in WAY worse condition than they currently are thanks to recent news stories posted by autoblog.

        I know the news needs to be reported, but a side note of "Autoblog is attempting to verify/deny the validity of this info, and then update the story when they hear from someone in the know.

        As far as your dealer comment, when GM puts out the same car in multiple brands, what are the dealers supposed to do but fight over customers? wouldn't your local BPG dealer want to make an Acadia more appealing than it's cheaper and uglier (but still very appealing) sibling Outlook? My point is that GM can eliminate this problem by NOT brand engineering a platform into 4 different cars. example: the lambda is great, but a buick, GMC, Saturn AND Chevy?! that's really setting yourself up for a loss

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