Rumor: Will GM Cut Brands to Save Cash?

Bloomberg  has an article about the possibility that GM might drop its Pontiac, Saab and Saturn brands in order to save cash. Without a doubt the fact that GM has to support eight brands is a lead weight tied around the General's foot. The bitter lesson that GM learned with Oldsmobile is that dumping a brand is a costly process.

Given that GM has worked hard to channel Pontiac, Buick and GMC brands into combined dealerships, it would be very interesting if it elected to euthanize just one of those brands. GM has already stated that it's trying to offload Hummer, adding Saab and Saturn to that list would be one option. As I've said before, I could see Sweden's automotive industry, Volvo and Saab, combining into one operation, although I'm not quite sure who would do the combining. As for Saturn, well it breaks my heart to say it, but the brand has had it struggles. It's unfortunate because Saturn probably has the best lineup of cars in its history, but there is that dark period where the brand really suffered from a dearth of product. It may be that Saturn can never recover from that period of decline.

Another idea is that GM could offload its Buick brand to a Chinese manufacturer. The brand is really a hit in China and I'm sure that it could fetch a nice price. This would also give a Chinese manufacturer an excellent way to enter the U.S. market. GM could then take Pontiac and GMC to the glue factory more easily.  

Realistically, the strongest nameplates for GM are Chevrolet and Cadillac. In order to show that it is really serious, GM may be willing to show that it can sacrifice one or more of its own brands in order to survive. Hey, it worked for Abraham.

source:  bloomberg