GM may axe Saab, Saturn, Pontiac

[dazzleman]

I imagine the actual up front costs of buying Saab would be rather low. To actually buy the brand and property GM would probably sell for very little, even just to get rid of the costs of running it day to day. It would be all the R&D and operational money that would be the issue as far as I can tell. There aren't a lot of companies out there that have that kind of money right now.

Maybe GM and Ford can spin off Saab and Volvo into a company of their own. That's probably the best scenario for the two companies. I'm not sure how much longer Ford is going to hold onto Volvo either. If they sold off much of their stake in Mazda, Volvo can't be too far behind.

I would think they'd have to sell it to one of the stronger auto manufacturers, for the reasons you mentioned.

Does Saab make money for GM, and Volvo for Ford?

When companies get desperate, they start to sell off their better assets to raise needed cash.  That's what AIG is doing right now.  Would Saab and Volvo be considered among the better assets for GM and Ford right now?

[the Teuton]

Saab doesn't make money; Volvo does.  More than anything, though, both brands do a lot of R&D for the rest of the company.

GM bought Saab as a response to Ford outbidding (and way overpaying) GM for Jaguar.  Anymore, all of these brands seem to be more or less irrelevant. 

[3.0L V6]

I would think they'd have to sell it to one of the stronger auto manufacturers, for the reasons you mentioned.

Does Saab make money for GM, and Volvo for Ford?

When companies get desperate, they start to sell off their better assets to raise needed cash.  That's what AIG is doing right now.  Would Saab and Volvo be considered among the better assets for GM and Ford right now?

I doubt it. Volvo's sales in North America have crashed. I have no idea about Saab's sales, but structure-wise they're both pretty integrated into their parent companies lineups. Saab uses the Ecotec, corporate V6 and Epsilon platform with the rest of GM and Volvo shares the large car platform with Ford. It would make them hard to seperate and sell.

[TBR]

I doubt it. Volvo's sales in North America have crashed. I have no idea about Saab's sales, but structure-wise they're both pretty integrated into their parent companies lineups. Saab uses the Ecotec, corporate V6 and Epsilon platform with the rest of GM and Volvo shares the large car platform with Ford. It would make them hard to seperate and sell.

I'd say that Mazda and Ford were/are just as integrated as Ford and Volvo.

[dazzleman]

I doubt it. Volvo's sales in North America have crashed. I have no idea about Saab's sales, but structure-wise they're both pretty integrated into their parent companies lineups. Saab uses the Ecotec, corporate V6 and Epsilon platform with the rest of GM and Volvo shares the large car platform with Ford. It would make them hard to seperate and sell.

They're integrated from a production/design point of view, but the brand identity of Saab and Volvo is quite separate from that of the other brands owned by GM and Ford.  So that represents a conundrum as far as what to do with those brands.

I am not an expert, but there's seems to be a niche market for Saab and Volvo that there may not be for, say, Buick or Mercury.

[Madman]

Ford will hold onto Volvo for as long as possible.  Ford has been leaning on Volvo's engineering expertise for it's new models, both in North America and in Europe.  Rest assured, if the day ever comes when Ford has to put Volvo on the block, Ford Motor Company will be finished.

Ford just recently put one of it's own men in charge of Volvo for the very first time.  Stephen Odell was appointed President and CEO of Volvo Car Corporation from 1 October 2008.  He is the first non-Swede to hold this position at Volvo.

Prior to his latest position, from April 2008 Stephen Odell was chief operating officer, Ford of Europe, responsible for product development, manufacturing, purchasing, and marketing, sales and service operations.

Between September 2005 and April 2008, Mr. Odell was Ford Motor Company vice president and vice president of Marketing, Sales and Service, Ford of Europe. Prior to this position, Stephen Odell was director and senior managing executive officer in charge of marketing, sales and customer services at Mazda Motor Corporation in Japan, where he was also a member of the board.

Mr. Odell joined Ford Motor Company in 1980 as a graduate trainee, Ford of Britain.

He worked in several management positions in sales and marketing in Britain and the U.S., before being appointed vice president marketing & sales, Jaguar North America, in 1997.

In January 2000, Mr. Odell joined Mazda Motor North America as a vice president marketing & sales.

Mr. Odell became chief operations officer, Mazda North America, in October 2000, and was appointed president of Mazda Europe in January 2002.

In May 2003, he was elected senior managing executive officer, marketing, sales and customer services, Mazda Motor Corporation, Japan.

By putting one of it's own high-flyers in charge of Volvo, Ford is demonstrating it is dedicated to keeping the Swedish manufacturer in the Ford family.

OTOH, Saab is in a very different position.  GM has allowed Saab's engineering team to wither away.  Today's Saabs are cobbled together with components supplied almost exclusivly from the GM parts bin.  Unlike the Volvo-Ford relationship, Saab is not really interwoven into the GM empire.  Rather, it is more of an appendage to GM's European operations, and one in which the parent company could very well live without.

If Saab were to be sold off, GM would surely want to continue supplying parts for Saab's existing models.  Saab could also continue building the 9-3 based Cadillac BLS for the European market until such a time as GM could develop it's own replacement.

The real question is who would want to buy a struggling minnow of a carmaker like Saab, especially in the current economic environment?


Cheers,
Madman of the People

[TBR]

I think you overestimate Volvo's importance to Ford. Remember that there is a lot sharing between Mazda and Ford.

[Madman]

I think you overestimate Volvo's importance to Ford. Remember that there is a lot sharing between Mazda and Ford.

Which is why Ford still retains a partial interest of Mazda.  It's ownership may be diminished, but Ford remains the single largest shareholder of Mazda stock.

Cheers,
Madman of the People

[TBR]

Which is why Ford still retains a partial interest of Mazda.  It's ownership may be diminished, but Ford remains the single largest shareholder of Mazda stock.

Cheers,
Madman of the People

But they have relinquished controlling majority, I am sure we can expect the same to happen with Volvo.

[rohan]

GMC needs to go.

Why?  They sell a lot of them and I know a couple of people that would buy another brand if GMC didn't exist.  It's not like the GMC brand costs them lots of money and I think the brands actually profitable.  A few parts have different logos on them but overall it's not many and literally millions of people think it's better looking. 

[cawimmer430]

Why does GMC exist? What's the difference between a Chevrolet _______ and a rebadged GMC ______? Aren't they the same from a price perspective? Both versions from Chevy or GMC strike me as the "construction man's car". 

[MX793]

Why does GMC exist? What's the difference between a Chevrolet _______ and a rebadged GMC ______? Aren't they the same from a price perspective? Both versions from Chevy or GMC strike me as the "construction man's car". 

GMCs are typically a little higher end than the equivalent Chevy.  Additionally, GM's heavier duty trucks/vans are exclusively sold under the GMC brand.

[cawimmer430]

GMCs are typically a little higher end than the equivalent Chevy.  Additionally, GM's heavier duty trucks/vans are exclusively sold under the GMC brand.

Thanks.

[MX793]

Thanks.

Actually, a quick double check reveals that you can get the "medium duty" (light dump trucks and such) trucks from both Chevy and GMC.

[Raza]

Saab should be sold to a company that will actually let it design its own cars and be its own brand rather than a place for more rebadges and "go-with-the-flow" strategies.

Saturn can die.  Pontiac, unless properly differentiated, can go too.

[dazzleman]

Saab should be sold to a company that will actually let it design its own cars and be its own brand rather than a place for more rebadges and "go-with-the-flow" strategies.

Saturn can die.  Pontiac, unless properly differentiated, can go too.

I agree.  But what about Buick?

[Raza]

I agree.  But what about Buick?

I think Buick is differentiated well enough.  They do have the market on soft, passenger focused cars that aren't made by Lexus, and they're very popular in the emerging market of China.  Yes, there is some perceived overlap with Cadillac, but with the Cadillac revolution, they don't really sit in the same sector of the market anymore (other than the current FWD DTS).  I worked up a plan once that would have GM keeping all its current brands and surviving, but it was slim.  Really slim. 

Buick is on the fence.  I could see it go and not care one bit, but I think a lot of Buick customers won't filter back into GM products (whereas Pontiac customers probably will, and Saturn customers may), rather they'd flock to cars like the Camry or Avalon.  They could stand to lose more by getting rid of Buicj. 

[2o6]

I agree.  But what about Buick?

Buick is the #1 selling marque in china. China has 1 billion people, and a growing audience of those that can afford cars.






Not happening.

[2o6]

Saab should be sold to a company that will actually let it design its own cars and be its own brand rather than a place for more rebadges and "go-with-the-flow" strategies.

Saturn can die.  Pontiac, unless properly differentiated, can go too.

Pontiac could stay (even with their GM switchgear and platform sharing) if they sported-up the brand. (FWD Cars and all) I think the G6 looks great, has a sporty stance, but has nothing that actually makes it sporty. Maybe a 5 or 6 speed manual, or some suspention changes could do the trick.


Saturn can go. After the elimination of the S-series and Plastic Bodypanels (with the ION) it no longer has anything unique.

[MX793]

Buick is the #1 selling marque in china. China has 1 billion people, and a growing audience of those that can afford cars.






Not happening.

As someone already stated, they can axe Buick in North America and continue to sell the brand in China.  Buick China is really its own seperate entity from Buick NA anyway (just as Chevy EU sells a totally different lineup from Chevy NA), so the loss of Buick NA would have zero effect.

[2o6]

As someone already stated, they can axe Buick in North America and continue to sell the brand in China.  Buick China is really its own seperate entity from Buick NA anyway (just as Chevy EU sells a totally different lineup from Chevy NA), so the loss of Buick NA would have zero effect.

However, Buick is being pitched as something different. Cadillac is Sports Luxury, while Buick caters to luxury, without the sports aspect.

[Raza]

As someone already stated, they can axe Buick in North America and continue to sell the brand in China.  Buick China is really its own seperate entity from Buick NA anyway (just as Chevy EU sells a totally different lineup from Chevy NA), so the loss of Buick NA would have zero effect.

The Chinese are very conscious about stuff like this.  MG recently started reselling the TF, but is building the first few hundred in England for sale to the UK market, stating that without a production and sales base in the UK and mainland Europe, the Chinese consumer will not accept their car.  The brand has to be legitimized. 

[Nebtek2002]

GMC is a true sales success story for GM.

Over the years, GM has ingrained in many truck buyers the alleged superiority of GMC over the "cheaper-made" Chevy.

Many GMC pickup and full-size van buyers won't go to Chevy if their brand is axed. They'll try something else first.

However, the Acadia sells in such microscopic quantities that GM could drop it and make just Traverses at the low end and Enclaves at the top end of that market. PBG doesn't need a redundant "better than Chevy" crossover any more than it needs a redundant "better than Chevy" car line--Pontiac-- Buick will do.

Another aspect of dropping Buick domestically is that it might create an impression in China that Buick China is fobbing off obsolete and undesirable goods and thus kill the brand there as well.

[dazzleman]

Over the years, GM has ingrained in many truck buyers the alleged superiority of GMC over the "cheaper-made" Chevy.

This statement shows the true stupidity of GM.  If only you could replace the word "Chevy" there with some brand that was actually a competitor.    It's come to the point where they just use their separate brands to cannibalize each other.

[TurboDan]

I know it's historical and all, but if GM wants to sell cars, it should axe Chevrolet.  Nobody wants to drive a Chevy car. 

Yes, Chevy trucks are seen as OK, but really, I can't imagine anyone buys Chevy cars for any reason besides price.  That may not be fair, as some of their newer cars are pretty nice, but nobody is buying them for that reason. 

[dazzleman]

I know it's historical and all, but if GM wants to sell cars, it should axe Chevrolet.  Nobody wants to drive a Chevy car. 

Yes, Chevy trucks are seen as OK, but really, I can't imagine anyone buys Chevy cars for any reason besides price.  That may not be fair, as some of their newer cars are pretty nice, but nobody is buying them for that reason. 

Chevy trucks could all be migrated over to GMC.  Other Chevys could be migrated over to Buick or Pontiac, if they're worth anything.  So maybe your idea has merit.

[TurboDan]

And if they want to keep the Chevrolet Corvette alive, just throw a legacy Chevy badge on there and sell it at Pontiac or Buick dealerships.

[dazzleman]

And if they want to keep the Chevrolet Corvette alive, just throw a legacy Chevy badge on there and sell it at Pontiac or Buick dealerships.

True.

It's sad that GM has come to this point.  When I was a kid, they were the reigning car company.  My family always owned Fords back then, and I always wished we had a GM car.  GM just seemed to be a 'cooler' car back then, for some odd reason.

[hotrodalex]

True.

It's sad that GM has come to this point.  When I was a kid, they were the reigning car company.  My family always owned Fords back then, and I always wished we had a GM car.  GM just seemed to be a 'cooler' car back then, for some odd reason.

Because they actually had a lot of cool cars back then. Now, they have a few cool models but the majority are just outclassed (though that's changing now)

[cozmik]

Just FYI. Volvo is not profitable for Ford either. The Volvo division has not been profitable for several years now. They are not really an asset that Ford needs, but they are closer to one than Saab is of GM. Ford, like it or not, has no real luxury brand, but Volvo is the closest. Lincoln still is pretty much a joke. Saab isn't something GM needs right now either. It does give them a brand for the entry premium market that seems to be gaining traction, but they could put Caddy there too, even though they don't want to.