GM may abandon Saturn, Pontiac, Saab for govt aid

WASHINGTON:General Motors, working to cut costs to win $12 billion in government loans, is studying whether to shed its Saturn, Saab and Pontiac brands in addition to Hummer, people familiar with the matter said. Selling or dropping brands would save money and reduce overlap as the biggest US automaker struggles to avoid running out of operating cash by year���s end, said the people, who didn���t want to be identified because no decision has been made.

The review of the 82-year-old Pontiac division shows the scope of the survival plan being given to Congress on December 2 to show GM can repay federal aid. GM also seeks to cut debt levels and reduce costs for active and retired workers.

CEO Rick Wagoner is under a deadline set by House speaker Nancy Pelosi and senate majority leader Harry Reid. Congress has scheduled a December 5 hearing on a $25 billion auto-industry rescue and may vote the week of December 8.

A GM spokesman, Steve Harris, declined to comment on what may be included in the Detroit-based automaker���s plan. Directors are scheduled to review a proposal on November 30 and December 1. The automaker will prepare a public document and a private, more detailed plan with background material. GM said on November 7 it may be short by year���s end of the $11 billion minimum in cash needed to pay monthly bills.

Members of Congress such as Republican senator Bob Corker Jr of Tennessee have suggested the automakers might benefit from being able to shed some of their dealers. GM���s eight US brands are the most among the domestic automakers, compared with four at Ford Motor and three at Chrysler. GM agreed to eliminate the 103-year-old Oldsmobile brand in 2000 because of declining sales.

GM established the Pontiac division in 1926. The brand���s sales peaked at 8,96,980 in 1978, according to trade publication Automotive News. That was the year GM sold 9.55 million vehicles worldwide, the highest ever, and came at the end of an era when Pontiac attracted notice for sports coupes such as the Firebird.

Pontiac sales are down 21% in 2008, compared with a 15% industrywide decline through October. The brand���s dealerships are the most numerous of the three units under study by GM. The auto-maker has 1,071 outlets for Pontiac, 400 for Saturn and about 105 for Saab among its 6,400 dealers, said Susan Garontakos, a GM spokeswoman.