DETROIT: In past years General Motors ceo Rick Wagoner (pictured) has resolutely resisted proposals to slim the number of brands on offer from the planet's leading (by a hairsbreadth) automaker. He now faces a reality check, forced by the latest economic Ice Age.
Citing its favorite euphemism, "people familiar with the matter", the Wall Street Journal reports that GM is mulling the axing of thousands of white-collar jobs plus the sale or mothballing of its non-core brands.
According to these sources, all but the Cadillac and Chevrolet marques are considered "non-core" – a fact whose significance is heightened by US auto sales figures which in June slid to a fifteen-year low.
This and allied issues will top the agenda at the automaker's next board meeting in early August.
Meantime, the flames of speculation have been energetically fanned by Merrill Lynch haruspices, who last week opined that GM will need to raise as much as $15 billion in cash to shore-up liquidity.
Bankruptcy, opined the seers, is "not impossible" if the US auto market continues to plunge. Little surprise then that GM shares languished earlier this month at a 54-year nadir.NEWS FLASH: 07.34 GMT 9/11/08GM Denies Plans to Slash Brands
General Motors cmo Mark LaNeve, responding to growing dealer concerns, said the automaker has no plans to ax any more brands from its portfolio.
In a letter to dealers obtained by Dow Jones Newswires, LaNeve wrote: "We engage you, our dealers, in this process of improving our business... that is the extent of the "examination" that is going on at this time for Saturn or any other GM brand. There is no breaking news here."
Data sourced from reuters.com and Dow Jones Newswires; additional content by WARC staff