The Sacrifice of Pontiac For GM’s Greater Good

Posted by

pontiac g8So, Blake Rong over at autoweek is having an interesting week. Blake interviewed GM Vice Chairmen, Bob Lutz, to talk about a few things. The topic of discussion: the shutdown of Pontiac. To many, the shutdown came as a surprise, Pontiac’s cars were sporty, affordable and popular amongst consumers. Because of this, it wasn’t GM’s idea to shutdown Pontiac but rather it was the Feds who said to shut it down. What was at stake if GM said “no dice”? A cool $60 billion.

Lutz: “Feds said, ‘we’re giving you 60 billion dollars. Drop Pontiac or you won’t get the cash.'”

Without getting into the ethics of the situation, it’s still interesting to see the degree of control the government held over the automotive powerhouse. Regardless, the entire situation provoked a slew of bargaining between GM and the government.

Here are some of Lutz’ comments, transcribed by Michael Ballaban over at Jalopnik:

The Feds basically wanted to get GM down to Cadillac and Chevrolet.They said, “you don’t need all these brands. You need one prestige brand, and one mass-market brand.” And we said “well we can’t get rid of Buick because Buick is important in China, and if Buick becomes an orphan in the United States then the Chinese are no longer gonna be interested in it.” And the Feds said “Fair enough, but everything else goes.” We said well we’d also like to keep GMC. They said “well, GMC is basically just like Chevrolet,” and we said “that may be true, there may be a lot of shared components, but GMC has an entirely different image, a different customer base, and people are willing to pay different prices for a GMC, and here’s the profitability,” and the Feds said “whoops, okay, keep GMC.”

So now we had Buick, GMC, Cadillac, and Chevrolet, and then, I wanted, badly wanted, to keep Pontiac, because Pontiac was on its way back, and it had been mismanaged for a number of years, you know, with ‘rebuild excitement,’ and the excitement was only in the plastic body cladding, mechanically there was nothing about Pontiac in the 90s that would make your heart beat faster. And with the solstice and solstice coupe, and with the Pontiac G8, which was a great car. We were embarked on a strategy of making pontiac different from the rest of GM in that Pontiac wouldn’t get any front wheel drive cars, they would all be rear-wheel drive, and the next G6, was going to use the architecture of the cadillac ATS, it was going to be a 3-series sized rear-wheel Pontiac, with basically the Cadillac ATS ‘de-premiumized,’ obviously, a lot of the cost taken out, but still fundamentally that architecture.

I’m curious to see if other developments leak to the public over the next couple of weeks. Either way, it’s interesting to get an inside view as to what happened.