TCC on GMRN

Everyone’s got their own take on what this alliance thing means, what’s going on, what’s going to happen etc. It seems you’re not a serious automotive journo if you haven’t written something about it. Consquently there’s a heck of a lot of reading material out there, but I’m trying to only bring the most poignant pieces to light here.

This one’s from Jim Burt at The Car Connection, and it’s rather ominously titled “Are Wagoner’s Days Numbered?: The writing’s been on the wall – and now board members are reading it.”

It’s one of the better interpretations of York and KK’s “squeeze play” that I’ve read. I don’t know how good this guy’s sources are or if it’s 90% speculation, but he seems to be prophesying a pretty rough board meeting on Friday, one that could even be Wagoner’s last at GM.

This whole situation seems to be bringing Ghosn’s admirer base to the fore, or maybe it’s Wagoner’s detractors.

This is a well written piece and I’d advise you all to spend your 10 minutes with it. It’s pretty dismissive of Saab, who 3 or 4 months ago were basking in a long term commitment from a parent that seems to be under threat.

Again though, it doesn’t spell out what the players in this drama really stand to gain for all the pain and trouble. Especially GM, who now have operations most likely in profit in Europe now, and a turnaround underway in the US (ignoring the Delphi elephant in the corner of the room for the moment). Until someone from even just ONE of these companies comes out and says quite plainly what the benefits really are, well, I just can’t beleive that this thing’s going forward.

Right now the biggest smiles sit on the face of KK as his investment’s gone up in value a little, and Ghosn, who can’t lose at this point and is all the more revered with every headline.

Friday’s going to be a biggie.

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5 Comments

  1. I didn’t like the ominous sounding phrase “under York and an outsider CEO, it is likely that the Buick and Saab brands would be shuttered as well, and HUMMER possibly sold off.”
    Shuttered means oblivion for Saab, doesn’t it? They shuttered the oldest automotive brand in U.S. history, and I don’t think they’d bat an eyelash before doing it to Saab. I think they would be more likely to shutter than sell Saab because it wouldn’t sell for much (compared to GM’s worth), and might come back to haunt them as competition in the marketplace.
    Would there be a way for the Saab marque to come back if GM just shutters the Saab brand?

  2. Woho
    Great Britain has done it.
    Saab sold more cars in june than arch rival volvo!
    Up a couple percent this month to for saab

  3. Ted:

    At the least, I don’t think that the Swedish government would allow a complete killing of Saab. They would certainly make a strong play to fund a buyout with a contract to use GM parts, labor, etc. I don’t think that competition from Saab would prevent GM from selling the company to a private buyer on those terms, either.

    Plus Saab can be profitable at a small sales volume, which no other GM brand except Hummer can say.

    Likewise, there are so many Saabs still on the road that selling parts for them has to be a profitable business.

    In the end, I think that there will be buyers.

  4. “Shuttered” does not mean that GM won’t continue to supply parts for cars already on the road. There are still a lot of Oldsmobiles on the road, and parts for those cars are handled out of existing GM dealerships.

    The worst case scenario is that GM stops making Saabs, but keeps the profitable parts and supply business for itself.

    Whether GM would sell Saab probably depends on whether the new GM wants to keep or sell the Trollhattan plant.

    I don’t think Saab would be worth buying without Trollhattan. And if GM wants the plant, but not the brand, oblivion is a possibility.

    And if GM keeps the jobs at Trollhattan, but kills the Saab brand, the Swedish government will have far less motivation to intervene. It’s one thing to do a buyout preserving Swedish jobs, it’s another entirely to spend tax dollars just to preserve a Swedish brand.

  5. Why should anyone kill-off SAAB when there’s obviously so much product redundancy within GM’s “core” U.S. brands already?

    Why not ax Buick, Pontiac and GMC trucks? Re-structure so that Cadillac sells the luxury cars; Chevrolet would sell the entry-level cars, SUV and truck offerings, while Saturn could peddle everything in between.

    Leave SAAB as General Motors European innovator and ditch – or sell-off – Vauxhall, Opel and Holden.

    And in Europe, why not let SAAB develop as GM’s luxury car brand instead of trying to shoehorn Cadillac into the position?

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