GM may sale some of its brands to raise money

General Motors Corp is planning to cut thousands of white-collar jobs and is considering whether it should sell or stop production of more of its brands, The Wall Street Journal said, citing people familiar with the matter.

Photo: GM may sale some of its brands to raise money

GM may sale some of its brands to raise money

Both moves are part of a broader re-evaluation of the company's strategy and of its ability to meet an internal projection of returning to profitability in 2010.

The job cuts are likely to be approved when GM's board of directors meets in early August, the people said. The reductions would be in addition to earlier announced cuts.

Management may also present the board with options for raising additional cash.

The board may also hear management's latest thoughts on whether GM should trim the number of brands it offers in the United States.

All but the Cadillac and Chevrolet brands, which GM considers core to its business, are undergoing close scrutiny, Reuters reports.

In the past few years, as GM has run up massive losses, some board members and some executives have on occasion raised questions about its plethora of brands, only to be rebuffed by Chief Executive Rick Wagoner, the paper said, citing people familiar with the matter.

David Healy, an auto analyst with Burnham Securities, said GM has enough money to make it through this year but may need more cash in 2009. The automaker, he said, has ways to raise money other than selling brands.

While Hummer is unique in terms of engineering and manufacturing and could be sold, other brands share vehicle underpinnings and manufacturing and are so integrated it would be tough to sever them, Healy said.

He questioned whether there would be any buyers in the midst of a U.S. economic downturn, the AP reports.

Hummer might be attractive to a Russian or Indian automaker for its U.S. dealership network, said Mark Warnsman, an analyst with Calyon Securities.

Saturn could be of interest to another automaker that doesn't have a mainstream brand, and a luxury automaker might have the expertise to revive Sweden's Saab, analysts said. Buick might be a tougher sell, they said.

Buick and Saturn continue to struggle despite having revamped model lineups and some of GM's best vehicles, said Tom Libby, senior director of industry analysis for J.D. Power and Associates.

Saturn, born in 1990 as GM's small-car answer to the Japanese automakers, was remade over the past three years with more upscale models, but sales this year are down nearly 19 percent.

Source: agencies