Why no threads about the demise of Hummer?

[Paul Gagnon]

I figured there would be at least one thread about this in here but I couldn't find any.



http://uk.reuters.com/article/motori...BrandChannel=0

GM may unload Hummer
Thu Jun 5, 2008 9:32am BST

By Soyoung Kim

WILMINGTON, Del (Reuters) - General Motors said on Tuesday it is closing four truck plants employing 10,000 workers and could sell its Hummer brand in a rushed response to higher gasoline prices that the largest U.S. automaker now sees as a permanent threat to its business.

Chief Executive Rick Wagoner, in a news conference before the annual meeting, said GM would close the four North American truck plants and add shifts at two U.S. plants making more popular and better-mileage cars to realign output with a U.S. auto market reeling from an oil shock being compared with those of the 1970s.

Wagoner said GM is reviewing its Hummer brand and could sell the military-derived SUV line, which has become synonymous with gas-guzzling excess and has hurt GM's image at a time when consumers are demanding more fuel efficiency.

"High gasoline prices are changing consumer behavior rapidly," Wagoner said. "We at GM don't think this is a spike or temporary shift. We believe that it is by and large permanent."

In a bid to lessen its reliance on the higher-margin trucks and SUVs that represent some 60 percent of its U.S. sales, GM's board approved funding for a compact car to replace the Cobalt and a new subcompact to replace the Aveo. Both Chevy-branded small cars are set to go on sale in 2010.

GM's board also gave final approval to the Volt, a heavily touted, all-electric vehicle that GM expects to have in showrooms by 2010 in a bid to beat rival Toyota to market with the kind of rechargeable car embraced by environmentalists.

GM said the latest steps would cut $1 billion (500 million pounds) from its costs by 2010, but some questioned whether they would improve the automaker's prospects in the face of a U.S. market now seen slumping well into 2009.

Wagoner said GM, which has lost a combined $51 billion over the past three years, is not ready to detail a timeline for returning to profitability

GM shares, which have lost almost 60 percent since peaking in October last year, initially rose on the restructuring steps, but gave up most of those gains when the automaker reported May sales results underscoring the pressure it faces.

GM's May sales dropped 30 percent after adjusting for the number of selling days. Sales for the first five months of the year were down 16 percent.

GM said it would stop making light trucks at plants in Oshawa, Ontario, and Toluca, Mexico, as well as at U.S. plants in Moraine, Ohio, and Janesville, Wisconsin. The Wisconsin plant, GM's oldest, opened in 1919.

Union leaders vowed to fight GM's closures, which would compound recent auto job losses and could loom as a presidential election issue in states such as Ohio and Michigan.

The White House said GM's action showed it is responding to a changing market to stay competitive. Democratic candidate Barack Obama, who had visited the Janesville plant on the campaign trail, blamed the Bush administration.

"Today's news is a painful reminder not only of the challenges America faces in our global economy, but of George Bush's failed economic policies," Obama said in a statement.

Canadian Auto Workers President Buzz Hargrove called GM's decision to close its Oshawa plant making the Silverado pickup truck a "betrayal." He said the union would press for a reversal of the decision and could strike.

"I want to state as clearly as I can: We are not going to allow this to happen," Hargrove said.

'TOTAL CAPITULATION'

Some analysts questioned whether the embattled automaker had moved too slowly, particularly on 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," he said. "They're not going to get anything for it. Just in terms of timing, it's a very poor example."

Tim Ghriskey, chief investment officer with Solaris Asset Management in New York, said GM would eventually see cost savings from its decision to close the truck plants.

"This is total capitulation by GM management to the price of oil," said Ghriskey, who does not currently own GM shares, but has in the past and follows the stock closely. "GM believes that the high price of oil is permanent and therefore they are making dramatic cuts in their low-mileage vehicles."

GM did not eliminate its dividend, which could save just under $600 million a year, a step some analysts have suggested is possible. Wagoner said dividend policy would be reviewed by the GM board each quarter.

Chief Operating Officer Fritz Henderson said GM has adequate cash to fund operations in 2008 and could raise more liquidity if the downturn in the auto market persisted.

GM ended the first quarter with $31 billion in cash and undrawn credit. Analysts handicapping GM's turnaround efforts have focused on the cash drain from its operations and support for two troubled former subsidiaries, GMAC and bankrupt parts supplier Delphi Corp.

In a sign of the deepening trouble for GMAC's mortgage unit, ResCap, GMAC and Cerberus Capital Management agreed on Tuesday to inject more than $1.4 billion to help the mortgage lender avoid running short of cash.

Cerberus bought 51 percent of Detroit-based GMAC from GM, which retains the rest of the equity in the financing company.

GM shares closed up 14 cents, or less than 1 percent, at $17.58 on Tuesday on the New York Stock Exchange.

[ky scrambled]

cause noone cares

[actionpaintball]

The Hummer name was considered abandoned as soon as GM took over.

[Bebe]

Three things are happening:

GM is reviewing it the brand, seeing if anyone will make an offer, or revamping the line (which they have been doing anyway ie H3 truck due out in September, HX/H4)....AND, there are other cars/models in worse shape.

Why would they kill their most profitable luxury brand?

You haters just love jumping on a bandwagon when you should learn how to read first

http://www.usnews.com/blogs/flowchar...-by-4-gas.html

[AtlantaK-5er]

Supposedly the H3T is still set for production late summer and they are testing it with the new 4.5L duramax engine. I could see that truck selling pretyy well. Also the h3 is doing well in Austrailia.

[Bebe]

Source:

http://fastlane.gmblogs.com/archives...um_1.html#more

A Note from HUMMER: Let the Speculating Begin
By Martin Walsh - General Manager, HUMMER

In preparing for the announcement about General Motors' putting HUMMER up for strategic review this week, we anticipated that subsequent rumors and speculation about the brand’s fate would soon begin. They have, and we can expect these things to swirl while we examine possible outcomes. But I want you to know that in the end I believe the HUMMER name, and its line-up of iconic vehicles, will still be purchased and enjoyed by customers around the world.

Globally, in eight short years, the HUMMER name has become one of the strongest brand names in the automotive industry. Today HUMMER vehicles are sold in 37 different countries around the globe. And outside the US, where the world has been living with high fuel prices for the past decade, 2008 sales through April were up 34.8% compared to 2007. It is a high-end product that holds inherent profit potential and already has a loyal and vibrant customer base. And, with nearly 60 % of HUMMER customers coming from outside GM product lines, it has highest conquest rate of any brand in the GM portfolio and HUMMER buyers are among GM’s youngest and most affluent.

HUMMER’s products are unlike anything else on the market. In addition to unmistakable, distinctive bold design, the trucks boast unparalleled off-road capabilities and fuel economy that is comparable to, or better than, most of their competitors in the market. The newly introduced 2008 H3 Alpha has won numerous awards, including Four Wheeler Magazine’s 2008 Four Wheeler of the Year and Truck Trend’s Best-in-Class: Hardcore 4x4.

And for 2009, the products and portfolio become even stronger. Already in production, the 2009 H2 offers even more interior luxury with available rear-seat captain’s chairs and Bluetooth connectivity.

The 2009 H3 and H3 Alpha deliver increased off-road capability with an available front-locking differential and standard Hill Start Assist. And this September we will introduce the new 2009 H3T, HUMMER’s first midsize truck. The H3T will appeal to the consumer who wants the towing and hauling utility of a full size pickup combined with the capabilities of a midsize HUMMER. In fact, the H3T is already earning significant media praise from industry experts including the editors of Four Wheeler and Pickuptrucks.com.

Four Wheeler Editor, Ken Brubaker, says, “The Hummer H3T is hands-down the most off-highway capable pickup in its class.”

And looking toward the future, the biofuel HX concept introduced at the 2008 North American International Auto Show injected consumers with renewed enthusiasm about the future potential of the HUMMER brand.

I wholeheartedly believe that HUMMER can have a bright future. It is growing globally and fills a niche in the automotive spectrum that delivers unparalleled off road capabilities in a luxurious package.

In any outcome, there is no denying the potential of a brand which holds such a vivid place in today’s culture.

[trkklr77]

no band wagon, i have hated hummers since the get go, search my name. hell i even got a temp band becase of the creation of the hummer section.

[Bebe]

Originally Posted by trkklr77

no band wagon, i have hated hummers since the get go, search my name. hell i even got a temp band becase of the creation of the hummer section.

Did you think I forgot about you?

[Paul Gagnon]

Originally Posted by Bebe

You haters just love jumping on a bandwagon

I thought this was the Hummer forum and I was surprised that there was no discussion about the future of the brand. Hiding your head in the sand doesn't stop things from happening in the world of big business.

[stjames151]

It's not really a lack of concern, its simply a lack of belief that Hummer or AMGeneral are actually going to disappear. There will no doubt be a serious re-evaluation of the product line and the outcome may not be what we all think. The H3t may have a significant impact on the brand, and the Hx is undoubtedly a hit if it doesn't get too watered down to be a real off-road contender. For now I think its best to wait till some more news comes out before we start with the doom and gloom talk

[AtlantaK-5er]

Originally Posted by trkklr77

no band wagon, i have hated hummers since the get go, search my name. hell i even got a temp band becase of the creation of the hummer section.

Good for you!! **kisses** for all we care. I am very impressed with your temp "band" whatever the h3ll that is!

[AtlantaK-5er]

Originally Posted by Paul Gagnon

I thought this was the Hummer forum and I was surprised that there was no discussion about the future of the brand. Hiding your head in the sand doesn't stop things from happening in the world of big business.

What were you expecting? All of us to be crying when nothing has happened?

BTW, Nice winch strap in your picture. Im impressed. I sense a bit of jealosy since even the most blinged out H3 could outwheel your ferd.

[Bebe]

Originally Posted by trkklr77

no band wagon, i have hated hummers since the get go, search my name. hell i even got a temp band becase of the creation of the hummer section.

yeh right,

I saw how you drooled over my mean machine at the carwash....sell someone else on that story

[Bebe]

Originally Posted by Paul Gagnon

I thought this was the Hummer forum and I was surprised that there was no discussion about the future of the brand. Hiding your head in the sand doesn't stop things from happening in the world of big business.

Because it was already discussed in Chit-Chat over a week ago.....

/forum/general-chit-chat/688621-no-more-hummers.html

[reverhart]

They (Am General) stopped making the humemr in the year 2006

The other pick-up trucks/mini suvs-grocery getters with fancy bodies on them, refered too as Hummers --may be in demise--boo hoo...lol

this is a good thing

When the Hummer comes back the brand wont be diluted..lol

I’m just glad I sold mine when I did, used H2s are becoming worthless


See you in Moab in a couple of weeks bebe. If you're really nice I'll let you ride in my Jeep again

[Bebe]

Originally Posted by Alec W

I’m just glad I sold mine when I did, used H2s are becoming worthless


See you in Moab in a couple of weeks bebe. If you're really nice I'll let you drive my Jeep again

fixed it for ya.see you on the 4th

[Bebe]

Originally Posted by reverhart

They (Am General) stopped making the humemr in the year 2006

The other pick-up trucks/mini suvs-grocery getters with fancy bodies on them, refered too as Hummers --may be in demise--boo hoo...lol

this is a good thing

When the Hummer comes back the brand wont be diluted..lol

You of all people should have your facts straight. AM General stopped producing the H1 in 2006. (They still produce the HMMWV) They continued producing in a joint venture with GM, the H2.

GM alone produces the H3, and sorry to say, I can't wait to mop up the trail when we run Fordyce with a couple of the psycho squad guys.

[Paul Gagnon]

Originally Posted by AtlantaK-5er

What were you expecting? All of us to be crying when nothing has happened?

BTW, Nice winch strap in your picture. Im impressed. I sense a bit of jealosy since even the most blinged out H3 could outwheel your ferd.

I was expecting to see a discussion about what direction people thought Hummer should go. Kinda like the great discussions that were had about the plight of Chrysler last year. I guess You'd rather pretend that everything is rosey. Or maybe you just have no opinion.

As far as my truck, don't bother. Explorers are the ORIGINAL unappreciated 4x4s, I've heard it all before. If it bothered me I wouldn't have the same rig after 11 years.

[Guinness44]

Someone hates Hummers, and the thread changes. Come on, we all like to have access to our lands, with our sport....who cares what one drives.

BTW H2s are made next door to the Humvee plant.

The direction at this point: Business as usual. Well see. Negative publicity, is always first on the list.

[ron b]

Originally Posted by Bebe

I can't wait to mop up the trail when we run Fordyce with a couple of the psycho squad guys.

uh oh. sounds like a set-up!

rb

[ron b]

Originally Posted by Bebe

They continued producing in a joint venture with GM, the H2.

yep, AMG assembles h2's next door to the humvee plant -- GM's construction of that plant was part of the hummer name lease deal. I wonder what will happen when the contract on the name and AMG's obligation to GM is up next year? AMG will be wanting to sell something if this war ever ends so I'm curious what they will come up with.

rb

[Bebe]

Originally Posted by ron b

yep, AMG assembles h2's next door to the humvee plant -- GM's construction of that plant was part of the hummer name lease deal. I wonder what will happen when the contract on the name and AMG's obligation to GM is up next year? AMG will be wanting to sell something if this war ever ends so I'm curious what they will come up with.

rb

Now that is interesting!

Lease up on Brand name.....Brand being reviewed by GM, in conjunction with a "permanent shift" in consumer sentiment.

It would be fine with the flex fuel or active fuel management technologies, already available in comparable GM vehicles.

I guess we'll see

[Bebe]

Another update.....do me a favor and don't just read the headline

http://ap.google.com/article/ALeqM5h...-MQfgD918NM1O1

Hummer dealers uneasy as GM weighs possible sale
By DEE-ANN DURBIN – 2 hours ago

DETROIT (AP) — As if high gas prices, a weak economy and a strike by a major supplier weren't enough to drag down Hummer's sales, Hummer dealers are now reeling from the news that General Motors Corp. may consider selling the brand.

GM Chief Executive Rick Wagoner told shareholders last week that the automaker was conducting a strategic review of Hummer and was considering all options, from revamping of the lineup to a partial or complete sale. Wagoner gave no timeline or further details.

"I'm not real happy with General Motors right now," said Brad Johnson, general manager of Hummer of Columbus in Dublin, Ohio. "It was a poor choice of words on their part and it's a bad decision to come out and say something when you don't know what's going to happen."

Jim Bushart, parts director at Lynch Hummer in Chesterfield, Mo., said he assumed GM was analyzing the Hummer brand as gas prices reach $4 a gallon and consumers look for more fuel-efficient vehicles. But he was surprised the automaker discussed the review publicly.

"Maybe they were hoping that by making an announcement they would drum up some interest," he said.

Others griped that the company could hurt sales of Hummer's first pickup, the H3T, which comes out this summer.

GM spokesman Nick Richards said the company decided to announce the review, along with the closure of four plants, to demonstrate how seriously it takes the U.S. market's rapid shift away from trucks and sport utility vehicles.

At an event in Washington Thursday, GM's North America President Troy Clarke again refused to give a timetable for the review but indicated it will be done quickly.

"It's in our best interest to move forward in a very expeditious manner," he said. "It's not the kind of thing that gets better with time. We ought to make our assessments, be decisive and get moving forward."

Hummer has always been a niche brand, with U.S. sales reaching a peak of 71,524 in 2006. By comparison, Honda Motor Co. sold 53,299 Civic sedans last month alone. But unlike small cars whose sales have exploded this year, the Hummer niche is disappearing. Hummer took the worst hit of any brand through May of this year, with U.S. sales down 36 percent compared to the same period the year before, according to Autodata Corp.

Dan Towbin, who sits on GM's Hummer dealers' advisory board and whose 60,000-square-foot Las Vegas Hummer dealership is the largest in the U.S., said he wasn't surprised by the news of the review. Towbin said GM has assured him it's giving equal consideration to continuing the brand with newer, more fuel-efficient vehicles.

"Obviously the landscape has changed for the automotive industry for a lot of reasons. There's been a dramatic shift from trucks to cars and crossovers, and fuel is an issue for a brand like Hummer," he said. "Like any good business they must continue to analyze their assets and determine whether they're worthwhile to continually reinvest."

GM hasn't named any potential buyers, but they could include Indian automakers Tata Motors Ltd., which just acquired the Land Rover and Jaguar brands from Ford Motor Co., or Mahindra & Mahindra Ltd., which was in the running for Land Rover and Jaguar, according to Aaron Bragman, an auto analyst with Global Insight. Bragman said Chinese automakers also have shown some interest in acquiring an American brand.

But Bragman said there are significant barriers to a sale, including the tight credit market and the degree to which Hummer has been integrated into GM. For example, the midsize H3 shares a platform with GM's compact pickups.

"I can't see them selling it but I do see them restructuring and coming up with some new product, a rethink of what they're doing with it," Bragman said.

Hummer's fortunes were partly influenced by a three-month strike at American Axle and Manufacturing Holdings Inc., a major GM supplier. The strike shut down operations at more than 30 GM factories and at the AM General LLC plant in Mishawaka, Ind., which makes the Hummer H2 under contract for GM. AM General owned the Hummer brand until 1999, when GM bought the marketing rights.

The strike didn't shut down the GM plant in Shreveport, La., that makes the midsize H3. But the company shifted production from the H3 to compact pickups for three months because of parts shortages due to the strike, spokesman Tony Sapienza said. Production of the H3 resumed at the end of May.

Craig Hubble, general manager of Hummer of Novi and Detroit Hummer, said he is selling every vehicle he can get, but his inventory has been severely diminished.

"The demand is there. It's the supply," he said.

But the broader problem for Hummer and other large vehicles has been the fast rise in gas prices. Sales of large pickups fell 21 percent through May, while sales of large SUVs were down 39 percent. The H3 gets 15 miles to the gallon, according to government estimates. The government doesn't estimate fuel economy for the H2 because it's so large, but dealers estimate it gets around 12 miles per gallon. With gas at $4 a gallon, it costs $128 to fill up the H2's 32-gallon tank.

Ed Williamson, owner of Williamson Hummer in Miami, says GM should respond not by selling the brand but by giving it more options with better fuel efficiency, including crossovers, diesels and hybrids.

"I think that there is a definite market for a Hummer family of vehicles," he said. "I think that there is a way to make a Hummer green, and I sincerely hope that General Motors decides to invest in that."

Towbin said GM will get a good start this fall, when it makes all its vehicles capable of running on E85 ethanol. Hummers that can run on biodiesel will be up next, in 2009, he said.

Towbin and others agree there's too much equity in the Hummer brand name to cancel it entirely.

"With Hummer, everybody has some opinion, and that is a wonderful thing as far as value of the brand. In today's business world, that's priceless," he said.

There's also a lot of money invested by the brand's 170 dealers, many of whom built mammoth, Quonset-hut styled showrooms in the last few years according to GM's specifications. Williamson said he spent $2 million on his 2,500-square-foot Hummer showroom. Johnson said some dealers spent up to $10 million building showrooms with test tracks and other elaborate features.

"There's too much money invested here for GM to do away with it," Johnson said. "They'd be looking at a huge class action lawsuit."

Other issues could make GM pause. While Hummer sales are down in the U.S., they're growing elsewhere, Richards said. Hummer sales were up 42 percent in Europe through April, thanks to booming sales in Russia and a new right-hand-drive version in the United Kingdom. Sales in the Middle East were up 27 percent, while sales in the Asia and Pacific region shot up 345 percent as right-hand-drive versions arrived in Japan and Australia.

And there are still legions of U.S. fans for whom gas prices are a minor inconvenience if they have $57,500 to spend on an H2 or $31,000 on an H3.

"Am I going to buy the next truck? Yes. Is someone going to build the Hummer? Yes. It's an icon," said Glen Peck of Annapolis, Md., a board member of an enthusiasts' group called The Hummer Club.

[AtlantaK-5er]

OK. Where I'd like to see Hummer go:

Bring back H1 Alpha ready to accept B100 Biodiesel and an optional Waste Vegetable Oil package with a gas tank heater and filter system. No one will use it but the public perception will be that Hummer is "green". Make lots of commercials showing how green the h1 is. Then, when you have the ICON back, add flex fuel engines to H2's and H3's and the optional 4.5L duramax (ready to use B100 as well) in H2's, H3's. Make the new H3T Alpha have the optional 4.5L diesel with a manual tranny option, and 35" BFG All Terrains in addition to the dual lockers, electronic sway bar disconnect. Also make the H4 Alpha a 4 wheel independent suspension, rivited alumnium, CTIS equipped, dual e-locker, mini H1 with similar creature comforts to the New Jeep Wrangler. Keep it wider than the wrangler slightly, and of course offer it with a diesel as well. They can offer a std version H4 without the lockers, CTIS, discos, etc. for the masses to get the sales numbers they need.