Off to car heaven

Moneyblog

Say goodbye to Saturn. And Saab and Hummer, for that matter. Pontiac, too, for all intents and purposes.

Unless buyers (a few million of us -- or maybe just a couple of really adventurous billionaires) step forward, three of General Motors? eight brands are now destined to join Oldsmobile in the history books. A fourth will be relegated to ?niche? status, says GM. The company, until last year the world?s largest automaker, announced plans Tuesday that would drastically scale back its operations in order to stay alive.

Production of Saturn cars would stop in 2011 if the brand hasn?t been sold, GM said. Execs will decide whether to pull the plug on Hummer at the end of March, though rumors of Chinese interest have emerged (and been discounted) several times. The company says Saab will be an ?independent business entity as of Jan. 1, 2010.? Take that to mean ?dead? unless a reluctant Swedish government can be convinced to step in. Pontiac will emerge as a ?highly focused niche brand? sold through Buick and GMC Truck showrooms.

All necessary steps, for sure. And insignificant, compared with the long-term future of the workers who make them and the towns that depend upon them.

Yet we?ll mourn these brands even if we won?t miss them.

Pontiac was long General Motors? coolest brand, its Firebird, Grand Prix and Bonneville as hip and relevant in their heydays as any BMW or Honda today. Its GTO was the first true muscle car, its Trans-Am the only legitimate reason to watch ?Smokey and the Bandit.?

Saturn once represented hope for a new way of doing business at General Motors, with distinctive plastic-bodied cars and a warm, almost nurturing sales environment. For a time, its ?Different Kind of Car Company? shtick worked: Its Homecoming gatherings in 1994 and 1999 drew 75,000 visitors to Spring Hill, Tenn., for a lost weekend of plant tours, country music and sheer differentness.

Hummer? While they might feel as outdated as a coonskin hat, they?re still a lightning rod for eco-terrorists (cops, too) and a raised middle finger to everybody in a Camry. At least you know where a Hummer driver stands, right?

There was a time when Saabs were charming ? ugly, obstinate and tough as hell -- but that came long before General Motors entered the picture in 1990. Its offerings today: rebadged GM generics with the ignition switch relocated to the floor.

For good or bad, GM has chosen its horses: Chevrolet, Cadillac, Buick and GMC. Would those be yours?

Don't expect a fire sale on doomed brands. There already is one, or close to it.

Once factories begin to be shuttered, the balance of supply and demand begins to tip the other way. Don't wait too long.

GM expects its dealer count to fall from 6,246 in 2008 to

4,100 by 2014, mostly in metro and suburban markets. What it will cost GM to disentangle itself from a politically powerful dealer body wasn?t specified, but it spent more than $1 billion earlier this decade to shut down its 2,800- dealer Oldsmobile division.

GM was the largest U.S. corporation by revenue as recently as 2000. GM held 50% or more new-car sales for decades, peaking at 55% in 1956. In 2008, that figure fell to less than 22%. Market capitalization peaked at $52 billion in

2000. Tuesday, after GM revealed its survival plans, that figure was $1.33 billion.

Whatever your feelings about Hummers, General Motors or cars in general, it's an astounding fall.

Not so astounding if you paid any attention to the total mismanagement that has been going on there since the 1970's. More like "inevitable"

Even at 22% share in 2008, GM sold MORE vehicles than it did when it had 50% of the market when there were far fewer bands and fewer vehicles sold.

Really? That may be your opinion but if that was the case, why did GM sell almost three times as many vehicles up until 2007 and its stock price split three times since 1965? LOL

But is worth less than 1940 today.

Curious that they should wish to rid themselves of 2 of their most promising (and best styled IMHO ) lines ( Hummer excluded ).

When will the Americans ever learn ?

2 Saturn models are already effectively Opels ( except they insist on putting bigger engines in them plus slush boxes ) and fuel efficient along with the Saabs.

Let's hope Investor AB will take a bigger interest, or even Scania step in ?

Graham

Yup, they turned Saabs from virtually unbreakable to 'ordinary'.

Graham

Perhaps but what does that have to do with your opinion that the mismanagement was going on since the 1970's?

Perhaps but GM sold ten times as many in the US LOL

Evidence ?

Ordinary cars now have build in obsolescence. Not necessarily due to engine, but the many electronically controlled safety gadgets; airbags, abs, active suspension. Any failure lights in those circuits and it's a MOT failure. You're supposed to scrap your car after 10 years. A 10 year old car is deemed to be excessively polluting. But is this really true?

My 1993 Saab 9000 LPT does 40 mpg on motorways, much the same as many modern cars of the same size. This car was already designed on the back of 1970's fuel crises, hence the use of turbo rather than a 6-cyl.

To be fair, a modern Vauxhall/Opel overlaps considerable with Saab, so there is hardly any point of the make. Except the wish to be different...

You don't appear to understand the American market...

"DervMan" gurgled happily, sounding much like they were saying:

Scania's hardly likely to step in, since they're largely owned by VW - and in the financial shit themselves.

When was that? 1943? GM is an impending disaster.

Has VW really been taken over by Porsche? Was that Jan 2009?

Charles

That was supposed to be the deal, although I haven't 100% heard that it's gone through.

nate

Charles C gurgled happily, sounding much like they were saying:

Porsche have long held a significant stake in VW - and upped it last autumn to 40+% with a stack of options - which caused significant amusement at the expense of the hedge funds...

It's not American's, per se. It's GM. Most Americans have a clue about cars, after many years of ignorance for most of them. Slowly they got a clue. That's why the "big three" are now going down the tubes.

But they're going out of business. So why does that matter?