The Death of America’s “Big Car” Culture: GM Gives Up on Hummers

Just a few years ago it would have been laughable to suggest that General Motors Corp, the icon of big cars, would trade in it’s Hummer for an electric car. But GM just confirmed that they are making the switch. Welcome to the new age of automobiles! GM  has announced that it is closing up four truck plants and wants to sell its Hummer brand in an effort to replace its traditional lineup of trucks and SUVs with small, fuel-friendly cars. Chief Executive Rick Wagoner said GM is currently reviewing the Hummer brand and may sell the entire military-inspired SUV line as “U.S. economic and market conditions have become significantly more difficult”. GM's board has also allocated production funding to the Chevy Volt, a heavily touted, all-electric vehicle that GM expects to have in showrooms by 2010, which will be assembled in Detroit. When Detroit starts making electric cars, you know it’s the end of an era.

The automaker notes that higher gasoline prices are a big part of changing consumer sentiments. In an effort to catch up with competitors, GM's board has also approved funding for a next-generation compact to replace the Cobalt and a new subcompact to replace the Aveo. The Chevrolet-branded small cars have been under development at GM's Korean unit for sale in 2010. GM said these moves would cut $1 billion from its structural costs by 2010, but Wagoner said GM, which has lost a combined $51 billion over the past three years, can’t promise when they’ll return to profitability. Analysts question whether GM has moved quickly enough, particularly in regard to ditching the Hummer.

"Unfortunately, it's just a sign that once again they're behind the curve," said Peter Jankovskis, a chief investment officer with OakBrook Investments, which owns GM shares in some of its portfolios.
"If they were looking to sell the Hummer brand, the more sensible thing would have been to do it three years ago. They're not going to get anything for it. Just in terms of timing, it's a very poor example," he said.

Pete Hastings, a corporate bond analyst at Morgan Keegan, agreed that GM had missed a chance to shop Hummer with potential buyers earlier.

"I wish they had done it awhile ago when it was really hot," he said. "I don't know what price they will get for it as now everyone is conscious of the permanent shift away from less fuel-efficient vehicles."
At this point only one thing is certain for GM and the world at large: Things are changing. 

Posted by Rebecca Sato

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Death by Hummer!

source:
http://www.reuters.com/article/businessNews/idUSN0231573020080603?sp=true

Comments

[RJ]

cool

[The only thing mini about me is my car!]

This great news! I have noticed a lot more smart cars in my neighborhood too! Hummers are the icon of arrogance and waste and I couldn't be happier to see that part of Americana die.

[matt]

I can really see both sides of this. Sure for the amount of fuel that the hummer h2 and h1 burned - they were a bit of a waste, unless you used them to go off roading or tow around stuff. But the h3 was a nice little suv (kind of reminded me of the older pathfinders).

I was more disappointed to see that they will be making less trucks - as trucks for the longest time have been a staple to Gm's revenue.

[jamie fitton gets onit evry day AN WOT YA MONGREL]

and wot