GM Denines Rumours: No Other Brand Are Under Review
DETROIT - Several reports are prompting out that General Motors is considering the sale of more than just one of their eight brands. But a GM spokesperson today denied all allegations explaining that apart from Hummer, no other brands are under any review.
"No other GM brand (besides Hummer) is under strategic review,” GM spokesman Tony Cervone said in an e-mail to Automotive News today.
Out of eight GM brands, most of them including Saturn, Buick and Saab are struggling to attract the buyers. So the company has already made up their mind to review their Hummer division for sale and the prospective buyers may include Mahindra & Mahindra.
David Healy, an auto analyst with Burnham Securities, said that “GM has enough money to make it through this year but may need more cash in 2009. The automaker, he said, has ways to raise money other than selling brands.”
But a person concerned with GM motors confirmed that some brands other than Hummer are also being studied. This person has not revealed his identity because no decisions have been made yet.
“Though Hummer is distinct in engineering and manufacturing and could be sold, other brands share vehicle underpinnings and manufacturing and are so integrated it would be tough to sever them,” Healy said.
“Hummer might be attractive to a Russian or Indian automaker for its U.S. dealership network,” said Mark Warnsman, an analyst with Calyon Securities.
GM is also likely to cut thousands of white-collar jobs as this decision will be approved when GM’s board of directors will have a final meet in the month of August this year.
It is believed that the auto giant is likely to re evaluate its entire business model as it has experienced a dramatic shift in consumer demand in terms of trucks and SUVs to small cars and crossovers. So several cuts are expected for its white-collar force which is as strong as 76,000 global workers. It is also predicted that the company needs to raise $ 15 billion (9.6 billion euros) to survive and remain afloat in the next two years or so.
