Wild Ass Rumor of the Day: GM to Kill Everything but Caddy and Chevy?

Frank Williams
by Frank Williams

Automotive News [sub] has a report on future models coming from Cadillac and it provides a lot of dots just begging to be connected. Among other things, Caddy is planning: a four-cylinder small sedan; an expanded CTS lineup that will include a coupe and sport wagon; and a redesigned SRX that only seats five and is between the Equinox/Vue and the current SRX in size. They've also decided to extend production of the DTS and STS without any further development but will eventually replace both with a single RWD sedan that "will be more competitive with the Mercedes E class and BMW 5 series." It's two other two things AN mentioned that really caught my attention: GM is "studying the possibility of Cadillac's sharing GM's Chevrolet Volt technology" and there's a possibility they'll replace the Escalade with "a model or two developed on GM's fwd Lambda platform" by MY 2013. So let's connect those dots: GM's planning a small Cadillac that will take the brand further down the price scale while Chevy introduces a more expensive small car in their lineup. They're repositioning the SRX as a smaller 5-place CUV, just above the Equinox in size. They're keeping the Lucerne's platform-mate DTS around for a while to hang on to older barge-buyers. They're considering Caddy as the only other American division to share the Volt platform with Chevy. They're looking at a fifth version of the Lambda platform which will essentially overlap the Enclave while the upper trim levels of the Traverse do the same with the Saturn and GMC derivatives. To me all those dots form only one picture: they're aligning Cadillac and Chevy so they could cover the entire market with just those two brands if need be. Once that realignment is complete, it's just a matter of time before they can methodically axe Pontiac, Buick, GMC and Saturn. The question is, can they do it fast enough to salvage what's left of the company? Just sayin'

(The Automotive News article is printed in its entirety here.)

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  • 50merc 50merc on Aug 27, 2008

    Re: the question of division versus subsidiary, this is an issue I've wondered about on occasion. GM became huge by acquiring other firms, such as Oldsmobile and Cadillac. In view of what I know of Durant's empire-building, I'm pretty confident the big acquisitions were generally done by swapping new shares of GM stock for the shares of the acquired company. Some small outfits might have been bought using cash; this would be the case if a sole proprietorship or partnership sold a business to GM. Incidentally, when Ford established manufacturing operations in the UK and Germany back in Model T / A days, the ventures were new corporations in which, if I recall correctly, Ford had less than 100% ownership. I've never heard whether GM retired the stock of acquired companies or held it as an asset. It seems likely the stock was retired, with GM absorbing the assets and liabilities. But apart from the nuisance of continuing to have multiple board of director meetings, etc., taxation and financial reporting (by issuing "consolidated statements") is the same either way. Finally, there'd be no legal obstacle to spinning off Buick, Pontiac, etc., even if those brands are divisions rather than subsidiaries. GM would just have to identify related assets and liabilities, assign those to a new stock, and issue those new shares to GM shareholders as a dividend. In theory the GM shareholders would be just as well off: in sum the two kinds of stock would equal the value of their previous GM-only shares. In reality, I would expect a torrent of lawsuits from quarters.

  • Durask Durask on Aug 27, 2008

    Re: chapter 11 Autos are not airlines. No one will buy a car from a company in Chapter 11 for a price comparable to a car from other companies. If GM would go Ch 11, even their best cars (the CTS and the Malibu) will have to be sold at half price to attract potential Camry/German buyers. Would I buy a CTS for half the price of Audi A6? Hell, yeah, even 2/3 of the price. Would I buy it for the same price as the new A6? Hell, no. So, IMHO, they are kinda screwed.

  • Arthur Dailey Rootes Motors actually had a car assembly facility in Scarborough ( a suburb in the east end of Toronto), during the 1950's and early 1960s. It was on the south-west corner of Warden and Eglinton located at 1921 Eglinton Avenue East. The building still exists and you can still see it on Google maps. That part of Scarboro was known as the Golden Mile and also had the Headquarters for VW Canada, and the GM van plant.Also at 2689 Steeles Avenue West in Toronto (the south east corner of Steeles and Petrolia) is what is still shown on Google Maps as 'The Lada Building'. It still has large Lada signs and the Lada logo on the east and west facades of the building. You can see these if you go to the street view. Not sure how much longer they will be there as the building just went up for sale this month. In Canada as well as Ladas and Skodas we also got Dacias. But not Yugos. Canada also got a great many British vehicles until the US-Canada trade pact due to Commonwealth connections. Due to different market demands, Canadians purchased per capita more standards and smaller cars including hatches. Stripped versions, generally small hatchbacks, with manual transmission, windows, door locks and no A/C were known as 'Quebec specials' as our Francophone population had almost European preferences in vehicles. As noted in previous posts, for decades Canadian Pontiacs were actually Chevs with Pontiac bodies and brightwork. This made them comparatively less expensive and therefore Pontiac sold better per capita in Canada than in the USA.
  • Ronin Let's see the actuals first, then we can decide using science.What has been the effect of auto pollution levels since the 70s when pollution control devices were first introduced? Since the 80s when they were increased?How much has auto pollution specifically been reduced since the introduction of hybrid vehicles? Of e-vehicles?We should well be able to measure the benefits by now, by category of engine. We shouldn't have to continue to just guess the benefits. And if we can't specifically and in detail measure the benefits by now, it should make a rational person wonder if there really are any real world benefits.
  • TheEndlessEnigma Simply put, I like it.
  • TheEndlessEnigma Ah GM, never stop being you. GM is working hard to make FIAT look good.
  • TheEndlessEnigma Top Gear of the 2000's was a fresh concept and very well done. Sadly to say there isn't a TV show concept that doesn't eventually exhaust fresh ideas and, as a result, begins to rehash and wear out once were fresh ideas. The show eventually becomes a pale imitation of itself, then begins to embarrass itself, it will get to a point where it jumps the shark. Top Gear began to get stale, the Clarkson, Hammond and May left and the formula failed - surprise! the presenters were part of the magic. Fast forward many years and Grand Tower is trying hard to be Top Gear but it's all very obviously scripted (it always was by felt spontaneous in its original form), Clarkson, Hammond and May are much older, tired and have become caricatures of themselves. Guys, just stop. You should have stopped 10 years ago. Now you're just screwing with your reputations and legacies.
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