Shocking Revelation From Former General Motors Company (NYSE:GM) Vice Chairman
The shocking revelation about why General Motors Company (NYSE:GM) suddenly announced to shut down its Pontiac line came when the former Vice Chairman at General Motors, Bob Lutz mentioned that the decision was made as the federal administrative officials straight away asked to cancel the Pontiac line in order to receive the federal bailout money. And it was all known that without the bailout money, the company might have gone bankrupt. This shocking revelation was made by Lutz while he was speaking at an event in Los Angeles. During the question and answer session, Lutz further mentioned that the federal officials said, “You don’t need all these brands. You need one prestige brand, and one mass-market brand,” and added, “The Feds basically wanted to get GM down to Cadillac and Chevrolet.”
As known to many, the decision to close down Pontiac came abruptly at the time when GM was set to launch a prime vehicle with powerful, rear wheel drive models in an effort to revamp the Pontiac brand.
Lutz further added that he wanted to keep Pontiac as there was a rebuild excitement where the company embarked a new strategy to differentiate Pontiac from the rest of GM with all rear wheel drive with latest G6 architecture of the Cadillac ATS. But the federal administration, which was supposed to extend $53 billion bailout aid, simply asked about how much profit Pontiac has helped earned over a decade and there was really nothing earned out of Pontiac.
However the fed claimed that the administration was not guiding any decision by industry executives. There is also news that government also wanted to cancel Buick which is now one of the best-selling brands at GM.
To remind our readers, earlier in December 2008 the automobile giants Ford Motor Company (NYSE:F), General Motors Company (NYSE:GM) and Chrysler sought the government for bailout to avoid bankruptcy. In last December, the U.S. Treasury decided to sell its remaining 32% stake in GM to erase it from government’s Troubled Asset Relief Program. Taxpayers spent $49.5 billion to rescue GM.