Mon Apr 27, 2009 7:56pm EDT

By Nick Carey

DETROIT (Reuters) - After 83 years of storied history and with a huge following
for its famous older models, Pontiac on Monday became the highest-profile victim
of the U.S. auto industry crisis with General Motors Corp's announcement the
brand would cease to exist in 2010.

The death of a brand that captured the imagination of generations with the
Firebird, Trans Am, Grand Am, Grand Prix and GTO -- the latter immortalized in
the song "Little GTO" by Ronnie and the Daytonas, which reached No. 4 in the
U.S. charts in 1964 -- left car enthusiasts stunned.

"If you're a car lover then this has to come as a real shock," said automotive
historian John Montville.

But after years as a high-performance brand producing legendary models, industry
experts said the brand's recent decline and lack of investment by GM had sealed
its fate.

"Pontiac had become a repository for anything GM could muster," said independent
auto industry analyst Erich Merkle. "It's very sad. But my sadness is for the
brand as it was, not for what it had become."

GM also plans to phase out other brands sold in the United States. It plans to
cease production of Saturn vehicles, sell the Hummer SUV line and will let
Swedish brand Saab go independent after its reorganization.

AMERICAN LEGEND

GM introduced the Pontiac brand in 1926 when the company was led by American
corporate giant Alfred P. Sloan whose famous quotes include "A car for every
purse and purpose."

Named after an Native American chief who led a failed uprising against the
British after the French and Indian War in 1763, Pontiac was originally launched
as an affordable companion to GM's Oakland brand. The brand's appeal to smaller
purses meant it soon outsold its parent brand.

"Pontiac was the son that outlasted the father, a rarity in the industry," said
automotive historian James Wagner.

Oakland went out of production in 1932.

Up until the early 1950s Pontiacs were unremarkable but solid. The brand gained
strength in the late 1950s, but the brand's real heyday came in the 1960s.

The 1960s saw Pontiac turn into a performance brand, much of it under the
leadership of John DeLorean -- later founder of the short-lived and ill-fated
DeLorean Motor Co.

The Grand Prix, the Firebird and GTO, all high performance "muscle cars", made
their debut during the 60's. GTO, short for "Gran Turismo Omologato" was
regarded as DeLorean's greatest contribution to the Pontiac brand

Pontiac scored later successes with the Grand Am and Trans Am in the 1970s.

Surf the Internet today and you can find fan sites and clubs celebrating
Pontiac's older famed models -- including the GTO Association of America.

The Pontiac brand chugged along until the late 1990s when GM began to scale back
on its performance image, launching minivans and "rebadged" vehicles from its
other brands.

According to industry tracking firm http://www.Edmunds.com, Pontiac's market
share slid to 2.1 percent in 2008 from 3.1 percent in 2002.

"In recent years Pontiac wasn't the performance brand it was in the past," said
Aaron Bragman, a research analyst at IHS Global Insight. "It had lost its way
and lost its following."

"There wasn't much future left for Pontiac," he added.

DEATH IN THE FAMILY

Although Pontiac's latest G8 model was critically acclaimed it was too little to
save the brand from the knife, a decision GM CEO Fritz Henderson said had not
come easily.

"A tough decision... for many of us because this is a brand that has a
considerable heritage," he said on Monday. "It is an intensely personal decision
in many ways, but one that needed to be taken in light of the circumstances."

Jeremy Anwyl, http://www.Edmunds.com chief executive, described Pontiac as a
"sacrificial lamb" as GM struggles to create a viability plan that will win
government approval and open up access to fresh emergency aid.

Like Chrysler LLC -- 80 percent controlled by private-equity firm Cerberus
Capital Management LP -- GM has received emergency funding to help it weather
the worst U.S. auto industry downturn in decades. Further help is contingent on
a new, viable restructuring plan.

"GM is marching to the beat of the government drummer," he said. "They must
prove they're serious about restructuring."

"The more dramatic GM's plan is the more credible it seems," he added. "Pontiac
is not essential so off it goes."

Michael Williams, dean of the Touro College Graduate School of Business in New
York, said the decision to drop Pontiac will not help GM and the government
should stop propping it up.

"This can't go on forever," he said. "The U.S. auto industry must undergo
complete consolidation or a selloff."

(Additional reporting by Bob Burgdorfer; editing by Carol Bishopric)