A different look at GM's consolidation

[HoosierRon]

There is a lot of talk on whether GM has too many divisions. I propose that GM already has cut more divisions than people generally recognize. Consider:

Old GM
1. Chevrolet
2. Pontiac
3. Oldsmobile
4. Saturn
5. Buick
6. GMC
7. Hummer
8. Cadillac
9. Opel
10. Vauxhall
11. Saab
12. Holden
13. Daewoo
14. Buick - China
15. Partnership with Isuzu
16. Partnership with Fiat (I apologize for reminding people of this one.)

Consolidation
-- Pontiac soon will be exclusively rebadged Holdens (plus the Solstice)
-- Oldsmobile shut down
-- Saturn soon will be exclusively rebadged Opels (plus the rebadged Solstice)
-- Buick appears heading toward becoming rebadged Chinese Buicks
-- GMC is exclusively rebadged Chevy trucks
-- Vauxhalls are RHD Opels
-- With the Chevrolet name taking over Europe, Daewoo appears to be turning into GM's Asian Engineering Center
-- Isuzu partnership is done
-- Fiat partnership is done

New GM
1. Chevrolet/GMC
2. Pontiac/Holden
3. Opel/Saturn/Vauxhall
4. Worldwide Buick
5. Cadillac
6. Saab
7. Hummer

Given all of the talk of further consolidation, I observe the following:

1. It costs GM practically nothing to make GMC products. There is no development costs, and the profit margin on GMC products is sky high. I doubt if there are many stand-alone GMC dealers any more. And GmC sells a LOT of trucks. There is no reason to cut this brand.

2. All of Pontiac's development costs have shifted to Holden. Furthermore, demand for Pontiacs is keeping Holden's production lines going. If GM were to close down Pontiac, Holden would have a hard time surviving. We want Holden to survive because it has a LOT of engineering talent that GM cannot afford to lose.

3. All of Saturn's and Vauxhall's development costs are borne by Opel. Given the distance between Chevrolet and Cadillac in Europe, Opel is not going anywhere. It costs GM practically nothing to rebadge an Opel into a Saturn.

4. The Enclave has shown that the Buick name is not damaged. It just needs good products. Between whoever was responsible for the Enclave and the Park Avenue, there is a place in the market for this brand. The new LaCrosse will prove this.

This leaves Saab and Hummer. With Opel moving upscale to make room for Chevrolet, Saabs really are becoming IKEA-ized versions of GM's worldwide platforms. We all may want to like Saab. We may want to think they are quirky and hip, but they never have sold enough to exist. As for Hummer, the H1 is gone and the H2 is going. That leaves a rebadged Colorado with big wheels and bad aerodynamics. It is finished.

So, sell Saab and close Hummer, and GM will have gone from 16 brands to 5 (with a few extra labels). I say that is enough.

[AMERICA 123]

Goodness, what an excellent post - how did I miss this ?

I don't agree with throwing the towel in on Saab and Hummer - I'd rather 'borrow' some money and go double time on a revised new product development program - for all. But hey, maybe things outside GM are stranger than it currently appears.

[civilzues]

excellent post!

[vcs2600]

Holden/Pontiac is like 50,000 units per year at most. If you think GM should maintain an entire brand infrastructure to sell a couple RWD cars, you're either misinformed or delusional. The people who actually buy Pontiacs want economy cars.

Also it's highly questionable that Americans will buy the same Buicks as the Chinese. We'll see I guess, but that's another brand that's maybe 100,000 units at most.

[Butz]

I agree with you.

If there is any value left in SAAB and Hummer, then GM is better selling them off. How many SAABs does GM sell anyway?

[FenwickHockey65]

This is a great idea. I think that the whole "rebadging across oceans" thing is a great idea, like Pontiac/Holden and Saturn/Opel. The only thing that needs to be done is proper marketing and Americanization to avoid a Saturn fiasco.
GMC is basically free money for GM. All they really need to do is make Chevy's trucks, change a few exterior and interior things, and you'll have a GMC, and people buy them. What I'd suggest under this idea is to simply cut back on GMT-900 production to the point that you only have a few models on the lot instead of 30 Sierras roasting away in the sun.

[Bravada]

16. Partnership with Fiat (I apologize for reminding people of this one.)

Yeah, GM would've been so much better without modern diesels.

[HoosierRon]

Originally Posted by Bravada

Yeah, GM would've been so much better without modern diesels.

For $2 billion, GM could have purchased all the diesel technology it needed.

[Stéphane Dumas]

Originally Posted by HoosierRon

4. The Enclave has shown that the Buick name is not damaged. It just needs good products. Between whoever was responsible for the Enclave and the Park Avenue, there is a place in the market for this brand. The new LaCrosse will prove this.

This leaves Saab and Hummer. With Opel moving upscale to make room for Chevrolet, Saabs really are becoming IKEA-ized versions of GM's worldwide platforms. We all may want to like Saab. We may want to think they are quirky and hip, but they never have sold enough to exist. As for Hummer, the H1 is gone and the H2 is going. That leaves a rebadged Colorado with big wheels and bad aerodynamics. It is finished.

So, sell Saab and close Hummer, and GM will have gone from 16 brands to 5 (with a few extra labels). I say that is enough.

Or the new Allure in Canada thanks to some weird name-games in French

And besides a new Allure/LaCrosse, a new Riviera/Wildcat based on the Alpha would be nice.

And for Saab, I wonder if Renault is still interested. I digged the net for old rumors from 2005 about this http://ezinearticles.com/?Renault-Ey...Saab&id=114248

[mbukukanyau]

Great post

[ronald mcretard]

I agree with most of that, and attention GM.... if you don't want Saab anymore, PLEASE sell it, DON'T kill it.

[NfamousZ24]

YAY For Hoosier Ron!!! This is another example of why I try to read all of your posts.

[2002 Caddy]

I vote for Ron at the board table...

Anyone whana bet that Rick and the GM board will do something 180 degrees differnet then this.

[FenwickHockey65]

Originally Posted by 2002 Caddy

I vote for Ron at the board table...

Anyone whana bet that Rick and the GM board will do something 180 degrees differnet then this.

Most likely.
I have written Bob Lutz a letter about my own suggestion as to what to do with GMC. Hopefully he'll see the benefits of my plan. It's not too much unlike HoosierRon's only with a different sales approach.

[2b2]

Yes, excellent, HoosierRon! Thanks!

my thoughts have been more about the U.S. 'presentation' of the Brands between Chevy & Cadillac
but they don't conflict with your more global view, much, actually imho follow from it...
...made a "My/Your Ideal Lineup" thread (with AmericanRevolution's agreement)
if anyone wants to post their consolidation/integration ideas in a lineup format:
my/your 'GM-I' Lineup: GM-Integrated: BPGmc ± ?
mine tries to Save Everything...sorta