Reality Strikes as GM Moves to Eliminate Pontiac

Anyone remember that first General Motors viability plan? I know it was a few months ago and all, and President Obama gave it the big “thumbs down,” but I’m pretty sure it was mentioned a few times in the news. And there was that one little part about how GM was going to focus on four core brands (Chevrolet, Cadillac, Buick and GMC) and get rid of HUMMER, Saab and Saturn. Pontiac, as I recall was going to be downgraded to niche status, focusing on a sports car or two and giving up its pretensions of being a mainstream brand.

The idea never got much traction, and a two-week-old quote from GM CEO Fritz Henderson was perhaps more telling. Henderson commented in BusinessWeek that GM’s “four core brands remain the bulwark of our strategy ... We remain committed to our four core brands." I got it, Fritz.

But it must have slipped some people’s minds or today’s announcement that GM will shutter Pontiac by the end of 2010 wouldn’t seem like such a shock. And the factory closings and 21,000 lost jobs? Again, what’s the big surprise? Could it be that the big headlines and all the hand-wringing are just a reflection of how much impact the auto companies really have on the economy?

I’m going to say “yes.” Because there’s a huge difference between just saying that GM should cut this or that division and close this or that plant to shrink its excess production capacity and then watching it actually happen. It ain’t a pretty sight, is it?

And unfortunately, the rest of the news from GM today is equally predictable, with the company proposing more ways to cut its debt without actually “doing” anything. I mean, I know I was on the “hurray for Ford” bandwagon when the Blue Oval announced it was able to cut its debt, but that was just part of the recent news. Ford also recently announced that it had finished retooling its Kentucky plant, at a cost of $200 million, as part of a broader move to reconfigure U.S. plants to produce a new wave of global vehicles.

I, however, do have a plan for GM that both incorporates reality and could significantly help with the Pontiac death march: Simply give up on the charade that there are serious mechanical differences between the lineups of its divisions. The message for potential Pontiac buyers and, to a large extent, Saturn shoppers, should be that getting those vehicles serviced after the divisions are closed will be no problem as long as Chevrolet stays in business.

That’s because there’s virtually no difference between a Pontiac G5 and a Chevy Cobalt, or between a Saturn Aura and a Chevy Malibu. And you can match up just about every Pontiac/Saturn vehicle with a Chevrolet sibling in the same way.

In other words, after years of being lambasted for badge-engineering so many vehicles, here’s finally a chance for GM to make that strategy work!