GM may have reason to be optimistic in 2010

Autos: GM may have reason to be optimistic in 2010


The last Pontiac has rolled off the Orion Township, Mich., assembly line, the innovative Spring Hill, Tenn., plant that once built Saturns is as quiet as a tomb, and the automotive industry is closing the books on one of the most disastrous years in its history.

It was the year of "Cash for Clunkers" that left us with images of perfectly good sport utility vehicles crushed into scrap metal after their engines were poisoned with a solution that would keep them from ever starting again.

To survive this year, General Motors endured months of ritual humiliation in its search for an economic lifeline as executives swapped corporate jets for economy cars and traded their Brooks Brothers suits for sackcloth and ashes.

Thousands of factory workers lost their jobs or surrendered benefits, and rust-belt towns lost their major employers.

Feisty Chrysler, which has been living on the edge since its last near-death experience in the 1980s, found a savior in Fiat, though its fiscal health remains in a more guarded condition. With just nine percent market share in 2009, down from 11 percent in 2008, Chrysler now ranks fifth in sales behind Honda in North America but still ahead of Nissan’s 7.4 percent share.

Ford, the only domestic brand that avoided bankruptcy and a federal bailout, through actually gained market share at 15.3 percent, up from last year’s 14.4 percent, according to the Web site Ford still trailed Toyota, whose 16.8 percent share was unchanged from 2008.

After shutting down Pontiac, killing Saturn, selling Hummer and shedding Saab, General Motors, remarkably, remained the nation’s top automaker with 19.7 percent of the market, down from 22 percent last year.

Even more promising for GM is its popularity in China, which replaced the United States as the world’s largest car and truck market in this watershed year. Sales in China are expected to surpass 13 million, exceeding the roughly 11 million total expected in the U.S.

The fact that Chinese consumers really like Buick was cited as the main reason GM kept that marquee over Pontiac. To boost Buick’s image in the U.S., GM has been developing an attractive array of sedans like the LaCrosse and crossovers like the Enclave. Buick also ditched Tiger Woods as its spokesman before Tiger became toxic.

In what may pass for good news, the theory that no automaker can survive bankruptcy may be on its way out. Consumers seem to have shrugged off GM’s sojourn into Chapter 11.

However, the dying brands and Chrysler’s weakened condition took a serious toll, according to J.D. Power and Associates. In a survey that ranks as the first of its kind, J.D. Power surveyed buyers to find out what brands they were most avoiding. Coming out on top were Chrysler and Dodge, Hummer, Saturn and Pontiac, the company said.

Fears about the future of the brand were cited by about 18 percent of those surveyed as a reason for not considering a particular model. Still and all, styling, price and perceived reliability outranked the brand’s future survival as a reason to avoid a particular model.

Sales of Saturn, Pontiac will continue into 2010 as the remaining dealers exhaust their inventories. Saab, as of this writing, has a slim chance of surviving as GM seeks a buyer for the Swedish brand that was "Born from Jets."

Pontiac will survive on memory lane for a while with the Baby Boom generation. But the warehouse of defunct brands is growing crowded with Oldsmobiles, Plymouths and AMCs.

Perhaps the saddest loss is Saturn because it died so young. Identified for most of its life with the Spring Hill assembly line where GM sought to reinvent auto manufacturing along the lines of Toyota, Saturn failed to become profitable.

Just about 20 years ago, Saturn came out with a new way of selling cars, eliminating haggling and giving buyers a simple and attractive deal. If Saturn accomplished anything, it changed the way cars are sold.

While GM failed Saturn by forcing it to live on a single model for too many years, by the end of its existence the brand offered a broad and attractive array of models from the economical VUE crossover utility vehicle to the Sky roadster that ranked as one of GM’s few styling marvels.

As the disastrous year of 2009 enters the history books, GM has reasons to be optimistic about 2010 and beyond. But the economic wounds will take a long time to heal.

(E-mail Richard Williamson at motorfriend(at)

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