Fortune's Alex Taylor: Make GM Chevy, Caddy and Saturn

April 26, 2007

Whenever we talk at cocktail parties--yes, we do get invitations--and people ask us about Detroit, we always respond, "Are you going to finish that?" But when they get serious and ask us why GM in particular is having problems, we tend to point out that there are more divisions inside the company than a middle school math book and that the development pie can only be cut into so many pieces.

GM management might demur, but we're not alone. Fortune car writer Alex Taylor neatly sums it up this week in his column that advocates nothing less than the shuttering of four GM brands and the redefinition of another. And it's logical: until GM slices more brand fat off the fairly muscular body underneath, it's going to bleed money away from its strengths merely to shore up its historical weaknesses.

Taylor calls it thusly:

"It is past time to perform euthanasia on Buick....the Buick brand can soldier on in China, where it is uniquely beloved;

"Pontiac should get the same treatment, though without the Asian escape hatch...In a world that increasingly is going green, there is little upside for its testosterone-laced pavement rippers;

"Whatever noble intentions GM had for Hummer, they have been permanently damaged by the greenhouse gas debate. Hummer should be sold to whomever winds up with Jeep after Chrysler is broken up....

"Say goodbye to Saab...The success of Japanese sport-luxury brands Infiniti and Acura has made Saab irrelevant."

Taylor also wants GMC to become GM's commercial truck brand, leaving only Chevrolet, Saturn and Cadillac behind.

We like this plan. And we know what GM's chieftans would say to it. But what do you think? Is it time for more slicing and dicing, or is GM on the road to recovery just as it is?

GM should shed dying brands --CNNMoney.com

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