GMInsidenews.com is quoting sources lacking even the thinnest euphemisms who whisper that Pontiac and GMC both could be on the chopping block. "At the moment," writes "nsap" of GMI, "the GM Board of Directors is leaning toward killing GMC as the brand is made up entirely of rebadges. The Board is also taking into consideration that GMC is mostly trucks and SUV's, both market segments that slowly dwindling." HUMMER is for sure dead (duh), and Saturn may get bumped to the PBG channel if (when) this all takes place. Not only does GMI fail to indicate a source, they attach a disclaimer. "Please remember that all of the above are RUMORS and should not be taken as solid fact." The only thing this rumor has going for it is that it makes a lot of sense. Neither brand really does anything Chevrolet can't, and in bad times that means they're expendable. BUT (caps lock off) GM can't kill anything without killing an entire channel (Buick, Pontiac, GMC)– and facing thousands of lawsuits. Unless they're in bankruptcy.
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I’ve been beating this horse to death over at GMI for years (and flamed for it). Until today.
The fact has been for years is that GM loses sales, share and money like no tomorrow spread thin over eight brands that they can’t afford to support and that there isn’t room for in our market.
If GM’s management had been forward thinking they would have restructured the company to be competitive as marketshare slipped which means phasing out brands that overlap, compete with each other or are simply not needed in our market anymore.
By now GM should be just Chevrolet and Cadillac. There is nothing any GM brand does that it’s core brands aren’t already doing or couldn’t do better.
Instead GM has waited until the company is in a full-fledged crisis and it will end up sinking the entire operation.
What company lets their credit rating go “junk”, tolerates a loss of millions (nevermind billions), underperforming brands that have never turned a profit (like Saturn, Saab), brands that completely overlap and compete with each other, spreading resources thin trying to prop up eight brands as marketshare continues to fall, not profiting at all on most cars sold and concentrating the future on a niche (trucks)?
What was obvious to many people outside the auto industry seems like it was never obvious to anyone running GM or they simply ignored it until now which is too late.
GM just has to keep things going until the new Obama administration gets into office. They’ll be plenty safe, once that happens.
Take it from first hand experience in Canada. Politicians love giving car companies tons of other peoples money. Don’t know why….
Too bad government doesn’t just say, “Let’s go help (fill in blank) go buy a pickup!”
How is Rabid Rick keeping his job? Lehman has a bad quarter and they fire the CIO the next day.
Drop GMC.
Drop Pontiac.
Drop Saturn.
Drop (or sell) Hummer.
Keep Chevy as the “everyman” brand. Keep Cadillac as the Luxury brand. I guess Buick should stay as a “mid-level” brand and keep the Chinese market happy… Even though it shouldn’t.
Better still, drop Chevy Trucks and amalgamate GMC and Hummer to sell ALL of GM’s trucks and SUVs.
GMC = Trucks
Hummer = SUVs
Chevy = Cars
Cadillac = Luxury Cars
I dove the wheels off a 1979 GMC K1500 from high school, through college and then some. Probably drove well over 200k with 4 engines. I think it would be a shame not to have GMC around, but I would not own one today, so I’m no help.
There’s no reason GM cannot continue to shill Buick to the Chinese while discontinuing it here.
GM does not need a dedicated truck brand. Chevrolet already sells trucks just like Ford just like Dodge just like Nissan and just like Toyota.
HUMMER is about the only name they own that is unique and that has any value outside of the company. They don’t have the financial means to do it justice which is a shame. It could have been GM’s Jeep if they had a viable Wrangler alternative on the road by now. It’s best they cash it out while they still can.
The only thing this rumor has going for it is that it makes a lot of sense. Neither brand really does anything Chevrolet can’t, …
Focusing for the moment on GMC, I’m not so sure. Last year they sold half a million Chevy truck/suv clones. While Chevy could make them (does in fact make them) can they sell them? Why do people buy GMCs ? It’s certainly not for lack of Chevy dealers. I don’t know the answer, but there is reason to doubt all those people would buy a Chevy.
How much does it really cost to slap a different badge on every 10th truck coming down the line? It’s certainly hard to believe GM is loosing money on it’s truck cloning division.
How much does it really cost to slap a different badge on every 10th truck coming down the line?
That is not where the expense is. It is the overhead of maintaining the brand. Advertising, dealerships, regulatory compliance, legal, etc.
the only thing that needs to be axed is Red Ink Rick. the time to do it was three years ago, now it is well past time.
Aren’t most GMC dealers also Buick and/or Pontiac dealers? Until truck sales crashed, GMC was keeping Buick/Pontiac dealers alive.
I’d rather see GM file now and let new management make, hopefully rational, decisions about what to kill off. The fact that Saturn still exists proves that the current bozos can’t be trusted to decide anything.
I’ve said it before and I’ll say it again: GMC should just be an option pack for Chevrolet. You get the GMC parts and styling and badges, but it’s a Chevy. Everyone’s a winner.
That is not where the expense is. It is the overhead of maintaining the brand. Advertising, dealerships, regulatory compliance, legal, etc.
Sure, but is that really more than earnings ? I’m just wondering aloud. If the Chevies comply, then so do the GMCs. The dealers are already there, and they sell more GMCs than they do B/P.
My point is that if we assume that all the GMC buyers would go to their local Chevy dealer, it begs the question – why didn’t they go to their local Chevy dealer in the first place?
Another point is this – GM doesn’t need to loose revenue/profits. GMC is the number 2 division, after Chevy. Assuming it’s profitable, cutting it prior to C11, makes no sense.
As EN points out, this can’t be done outside bankruptcy because GM would have to spend all it’s “savings” on lawsuits. After bankruptcy, it makes sense.
Cut a brand, and many of those buyers won’t go to Chevy.
GM’s biggest problem could well be they spend far too much time and effort dithering about whether to do this or that.
Don’t cut a brand, continue to lose sales overall and see the company collapse under the weight of all fo them together.
Why do people buy GMCs ?
Maybe they have an anti-Chevy bias (like me). I like the GMC styling better. Not that I’ve bought one…..
I agree with Dave M the GMC styling is cleaner, especially now between the Sierra and Silverado. The Silverado look kind of dorky. Plus the GMC name is a little more upscale in the customers eyes, plus they look a tad nicer on the inside. And I know some people aren’t going to like this but to some the Chevy name means redneck or trashy so they head straight over to there local GMC dealer. Which brings up another point the dealers could be drasticly different in there treatment of the customer.
Seriously, the most entertaining part of GMI carrying this story is the legion of kool-aid drinkers posting their opinions as to which of GM’s many brands, with many suggesting their is no need to cut any of them, only better define them.
IMO, HUMMER is the first, GMC (or Pontiac) is next followed by Saab, then Saturn, then Buick. This assumes of course GM doesn’t go Chapter 11 and nuke the whole works save Chevrolet and Cadillac, which is really where they need to be.
Maybe it’s just where I live but GMC really caters to fleets/construction. My company (construction) and every company that we work with that purchases GM products buys GMC. And for some it extends even to the executives. President drives the Denali line, mid-management drives the Yukon, and then Sierra for the fleet. I don’t know. I’d hate to see GMC be eliminated for some reason.
None of you are aware of the laws in this country, you cannot just decide to shutdown a brand and walk away. Franchise law is very complex and I am sure none of you are well informed but you all have an opinion.
Dave M:
My dad also bought his GMC C1500 because he preferred its styling over that of the Chevy.
Unfortunately for GM, this was 12 years ago.
Actually Roar TTAC has mentioned many times that killing a brand results in expensive lawsuits from the dealers many many times.
The fact that it costs a couple billion to shut down a brand is symptom of GMs problems, not an excuse for the execs to rearrange deck chairs on the Titanic to avoid making sausage (to mix some metaphors)
As soon as GM sold off their medium truck line that was the death knell for GMC. Unless something weird like a merger with ALL the trucks that GM still makes into a dedicated truck division, which was GMC’s reason for being, it’s toast.
How they can get that past the franchises I can’t see. Even with rationalization the dealer network isn’t shrinking fast enough. Probably this is just a shot across the bows for the network, waitng for any dealer sitting on the fence hoping to tough it out into cutting their losses and leaving.
If Mahindra buys the Hummer brand, how long will it be until with see small clean diesel pickup trucks built by Mahindra and sold at Hummer dealerships?
GMC would be my last choice to shut first simply because it costs almost nothing to keep alive. Saturn is the first choice as it is damn expensive to engineer and market vehicles which share not a single piece of sheetmetal with any other GM vehicles. Next up, kill Pontiac.
If the goal is to get to just Chevy and Cadillac right away then I’m on board. But if only one brand must go, GMC is a dumb place to start.
Then again, what does GM’s board of directors really understand about managing a car company? They keep telling us what a great guy Rick is!
Other posters have correctly stated that actually killing off a brand would incur huge financial costs to a cash-poor manufacturer.
Unless…you sunset Pontiac with no new product and allow the Buick and GMC dealers to merge willy nilly with Chevy and Saturn dealers.
Logically, I’d imagine it makes far more sense to sell brands like Saab and Saturn with a bundle of cash included to thank the buyer for taking the trouble. Sort of what the Benz boys did to get rid of Chrysler.
GM can just use Pontiac, Buick, and whatever division they want to throw away as exclusive rental car divisions. No driving down Chevy values as much. Instead of GM selling to rentals, let B/P dealers be the middlemen. Make them straight rebadges of Chevy’s. Pontiac with a little more sport (since rentals were meant to be abused) and Buick for those who graduated from rentals-were-meant-to-be-abused.
GMC can change to a commercial fleet division.
Chevy is Chevy.
Saturn should just permanantly keep “rethink” as that’s what its good at. Is it the division where the cars are plastic and can survive a runaway shopping cart (but what if an 18 wheeler t-bones me?) division or the Euro GM rebadge division with a mysterious Pontiac Solstice rebadge too?
Keep Hummer happy as an aftermarket division – The pimp-my-ride division of GM.
Saab? Run them over with Hummers
What I never understood is why Satrun is not selling. The Aura is 100% nicer than the Impala. The Astra is wayy nicer than the cobalt. And the SUVs are not ugly at all. Even their logo looks better than the chevy’s (i do understands that that logo is worldwide known)
There’s a question of where would GMC buyers go, if there was no GMC. The question is, would they go to Chevy, or Ford/Dodge/Toyota/Nissan. Unlike Oldsmobile, GMC has nothing, other than styling, to set it apart from Chevy. If you offer a front clip and nicer interior appointments, you’ve pretty much nixed the rationale for the brand.
Unless you really think that those hundreds of thousands of GMC buyers would, seriously, go to Ford. I’d hazard that’s a silly assumption to make.
GMC has less raison d’être than Mercury or Saturn.
I would bet that 99 out of 100 GMC buyers know full well that they are getting the same truck as a Chevy with a few trim and option bundling differences.
Why couldn’t you just rebadge the dealers as “Professional Grade Chevrolet Truck” dealers? Probably cheaper to rebadge the dealers, save the money rebadging the trucks and nuking the distribution channel.
As explained in DW181, GM will avoid the cost of closing the brands (like incurred with Oldsmobile) through Chapter 11.
Before the BPG idea was started truck buyers would buy GMC because their dealers were dedicated to truck buyers. Buying a GMC meant you didn’t have to wait behind the Chevy car owners to get service. Especially good if you were a commercial buyer.
Okay so they kill off Pontiac and GMAC. That kills a long list of dealers too which is a good thing.
Why not remove any duplicate entries in the GM lineup and then sell them ALL under one roof?
The G8 is different from any other North American GM vehicle so we keep it. Ditto on the G6. However the G5 is just a Cobalt so kill it off. Maybe folks would like the different trim packages of the Cobalt and G5 and they could sell them side by side, admitting they are the same car with different trim packages. Keep the Saturns but kill off that big snout minivan that all the divisions sell. Sell it only as a Chevy.
Then the consumer could walk onto a lot and see 35 different products and choose from that. There are real choices to be had. Not this big long confusing product catalogs that the average consumer barely understands.
They would see a big shiny GM logo on the sign with all the division names listed under the logo on the pole. The facade of the building would repeat those name all around the front. GM could quit the divide and conquer business model. People would go to the GM dealer to see all the choices and discover models they did not know existed. The better dealers would survive. The crummier dealers would sucum. I mean if they kill of GMAC and Pontiac a whole lotta dealers are going to die anyhow…
I suspect though that GM will have to declare bankruptcy to really change their business model – shed the UAW, shed all sorts of legacy contracts and benefits, shed all sorts of franchise agreements… Then they reorganize and come back a fighter which can make money on cars big and small.
On the other hand maybe the end is near for gasoline powered vehicles thanks to technolgy and the internet (people getting the straight scoop on EVs) and they know they will have to be a much different company as well as big oil will have to change their business plan too.