Hummer May Be Going, But It Won't Go Quietly

Implications: GM can't just wish away the Hummer dilemma. It has four major options, sell it, discontinue the brand, try to remake it as a "green" vehicle, or stick with it as it is.

Analysis: Hummer has always appealed to in-your-face consumers. Get out of the way of a tank-like, wide-stanced Hummer or suffer the consequences. And, do these hefty models absolutely devour gasoline? So what?

That approach worked for most of the decade GM has owned the Hummer brand. But now that GM's leadership has decided to about-face away from their long reliance on large, heavy, gas-hogging vehicles, the company announced last week that it was evaluating Hummer's future.

Unfortunately, GM can't just wish away the Hummer dilemma. They have four main options: Sell Hummer as Ford recently sold Land-Rover Jaguar; discontinue Hummer as GM did Oldsmobile; revamp the division with some sort of greener cast; or basically stick with its bully-on-the-block persona, in hopes it may return to favor.

Whatever decision GM makes, it better happen fast. I can tell you some of my Hummer clients are anxiously waiting for word from GM on how it intends to deal with its 170 dealers. Reports have surfaced that investment bankers are soliciting bids from India's two biggest automakers. Meanwhile, combined sales in the two segments that Hummer competes-large SUVs with its H2, and mid-size SUVs, with its H3 were off 45% in May.

In the end, some people think-or at least hope-that GM's announcement about re-evaluating the brand was as much a feint as anything else, perhaps designed to buy GM leadership time to figure out how to revitalize and keep the Hummer brand. These true believers think that Hummer continues to be a brand on the long-term rise and that GM would be foolish to let it go now.