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I, like so many people who have been following General Motors' fortunes for some time, am wondering what the company's long term plan of action is in the face of historic losses, plant closings, and unrelenting and widening competition. No, I am not talking about GM's global operations, rather I am talking about the North American fortunes of the world's largest automaker. Quite frankly, the North American market is currently unprofitable for the company while GM holds its own, even thrives, in many markets beyond our borders. The following are some suggestions to help "The General" not only get back on its feet again, but to halt the bleeding in North America.

File For Bankruptcy -- It is time to play hardball with recalcitrant unions and government authorities who don't understand that GM is playing on an uneven field. Toyota, Honda, Nissan, and Hyundai all build cars in the U.S. None of them are saddled by huge legacy costs, i.e. health and pension benefits, local tax burdens, etc. Yes, GM negotiated their contracts in good faith, however the market has changed tremendously over the past several decades and is wholly unfavorable to the way GM has been doing business since then. In addition, GM often operates at a disadvantage in foreign markets as local laws limit their ability to effectively sell their vehicles.

Quit Building Small Cars -- All small cars built by GM should no longer be built in the U.S. This includes the Saturn ION and Chevrolet Cobalt. Instead, GM should rely on imports. By tapping its relationship with Daewoo of South Korea, GM can bring in enough cheaply made models to remain competitive and to give consumers affordable transportation under the Saturn, Chevrolet, and Pontiac nameplates. Use factories in Canada and the U.S. to build larger cars and trucks only. GM has been successfully selling the Chevy Aveo, a Daewoo model, and can easily sell other models at competitive prices. This practice would be especially wise as cheaply priced Chinese cars begin to hit the North American market in 2007.

Shore Up The Divisions Unlike some who think that GM has too many divisions, I disagree. Better to clarify your existing divisions than to go through the costly and negative closing of existing divisions. The Oldsmobile termination was a huge financial drain on the company and ended up fueling hostility against the company. Therefore, this is what I propose for GM:

1. Cadillac - GM's luxury division is riding high and no changes need to be made. Keep producing distinguishable high quality luxury cars and Cadillac will continue to compete against the likes of Lexus, Mercedes, BMW, and Infiniti. Cadillac outsells Lincoln by more than 2 to 1 and the division performs well in all consumer quality and satisfaction surveys.

2. Buick - As the "near luxury" division for GM, Buick must create a viable alternative to Cadillac without sacrificing quality or confusing consumers. Bring back in a "halo" model like the Regal to show Buick's youthful side.

3. Pontiac - Unless the Firebird returns, Pontiac's performance image is gone for good. Pontiac needs this car and it must be different from the proposed Chevy Camaro. Besides Saab, Pontiac is the one division that needs the most work when it comes to reinventing itself.

4. Chevrolet - Keep up what you have, but rely on imports to fill the lower end of the market. Redo the Impala to help it compete successfully against the Chrysler 300, Toyota Camry, and Honda Accord. Yes, bring back the Camaro!

5. Saturn - Moving in the right direction, Saturn should chiefly sell cars that are Opel inspired. Give the car a more European flair and the division will succeed. The Sky is a knock out and the Opel inspired Aura is a vast improvement over the old "L" Series model. Keep the strong dealer network in place and Saturn will compete successfully against Hyundai, Honda, Toyota, Nissan, and others.

6. Saab - GM's Swedish division is floundering and may be cut. Better yet, let the division sell upscale versions of Opel models and please do not throw out the Swedish touch: safety and durability. Unfortunately, GM hasn't been as kind to its Swedish company as Ford has been to its Volvo subsidiary.

7. GMC - Between Chevy and GMC, no manufacturer sells more passengers trucks then this division. Likely, nothing will change, but coming out with a more capable small pick up truck would go along way in helping GMC and Chevy. Also, redo the Equinox to be a real battler against the Ford Escape and Toyota RAV4.

8. Hummer - GM's niche division is the Hummer and little needs to be changed other than to add an H4, a compact Hummer. With the H4, give the division something to go with that can battle the Jeep Wrangler. Hummer will always be perceived as the company's gas guzzling company, but it is also profitable for the corporation.

Personally, I do not want the bankruptcy route to be exercised as I know that so many suppliers would be left out in the cold, jobs lost, and goodwill would take a hit for at least the short term. Still, aggressive action - even beyond plant closings and layoffs - must be considered otherwise GM will be relegated to operating as a second rate player in North America while pursuing its fortunes abroad. In my opinion, neglecting the profitable North American market would be a shame and very costly.

Copyright 2006 – Matt Keegan is The Auto Writer who writes on a variety of topics including, new cars, industry trends, auto parts and accessories, classic cars, and more. Matt invites you to purchase all of your replacement car parts right online to save yourself money and time.

Hold the Presses: Saturn May not be R.i.p. After All

Saturn's impending demise as an automaker may not be so near after all. When General Motors announced recently that they were planning to shed some brands either through sale or closure, the Saturn brand was included as one of GM's divisions that appeared to be highly vulnerable.

Automotive News is reporting something different regarding Saturn's fate, indicating that the brand could survive particularly if GM overhauls what was once a separate but wholly owned car company run by GM. Today, Saturn is an outright GM division just like Chevrolet, Pontiac, Buick, etc., but the brand still has something the other divisions don't have: a solid dealer network built on the premise of treating the customer right.

That dealer network is 425 units strong and for GM to shut each dealer down would cost the automaker three to four million dollars each which translates to a maximum of $1.7 billion to shut down the dealerships alone. Back in 2003 when GM closed down Oldsmobile, the automaker was forced to buy out dealers even if they were fortunate enough to switch to another company brand. That move was costly too and today's cash strapped GM, government loans or not, would find shutting Saturn down to be a difficult move.

A separate sale of Saturn isn't possible, given that the automaker shares facilities, platforms and everything else with GM's other divisions. When the brand launched their first vehicles in 1990, Saturn's factory, platform and work force was unique to the company, but the company was gradually assimilated by GM beginning later in the decade. Hummer, on the other hand (and Saab too) can easily be sold off, two brands which likely will not be part of the GM fold come 2010.

So where does that leave GM? Well, the latest word is that the automaker will keep Saturn, but overhaul its product line. Curiously, this is something that has been taking place for the past several years and, come 2014, the brand was to be fully integrated with Opel. Saturn and Opel would sell the same vehicles plus one or two other models exclusive to the American market. Now, those plans appear to be up for grabs, leaving Saturn's future direction cloudy.

GM says that they will be holding meetings to determine the direction that Saturn should go to create a “new business model” for the brand. Talk of closing Saturn isn't helping dealer confidence and it does nothing to encourage shoppers to visit Saturn show rooms. Let's hope GM figures out what role Saturn will have in an overhauled company and gets that figured out as soon as possible.

About the Author

Matthew C. Keegan is a freelance writer who resides in Cary, North Carolina. Matt is a contributing writer for Andy's Auto Sport an aftermarket supplier of quality parts including headlight bulbs and over cab lights.

Some of the worst cars ever made?

What are some of the worst cars ever made in the automotive history? My choices are the Yugos, VW Dasher's, the 80's X body cars (Chevrolet Citation, Pontiac Phoenix, Buick Skylark and Oldsmobile Omega), Ford Pinto, Chevrolet Vega and AMC Pacer.

I've forgotten all about the Cadillac 6-8-4 V8 engine, those were terrible engines, remember the crappy GM Diesel engines of the late 70's/early 80's, those were awful engines.

Mercury Capri, Ford Mustang II, almost any American car made from 1974-85.

Skill, luck led to GM’s gains in Chinese market
In one of the more interesting twists in recent history, General Motors now sells more cars in China than in the U.S.

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