I would argue they have been doing this relatively well. The Pontiac G6, Solstice, Saturn Sky, Chevy Aveo. Buick Lucerne is definately a strong Lexus ES fighter and the plans to turn Saturn into Opel's US operation is a solid one.

GM's problem isn't building cars that can compete. It also isn't an issue of quality, as Chevy, Cadillac, and Buick regularly trump Toyota in the IQS. GM's problem is a bad reputation among consumers. We have a huge segment of the population that has been brainwashed into this "Toyota, Honda, or Nothing" mentality.

Honda and Toyota can keep milking these same tired cars, don't really even try, and they fly off the lots while GM (and Ford) need to take a page from Chrysler's playbook and make American cars. Right now, they're competing with a bunch of really well made Japanese clones.

Step into a European car, you know you're in a European car. Step into a Japanese car, you know you're in a Japanese car. GM and Ford need to rediscover what the American car is. It's not a tight handling GT built for autobahn speeds or a small and efficient gadget-and-gizmo-mobile with 40 cupholders. Strong and imposing design, big on power, comfortable and roomy. It's what they've been doing all along with their SUVs but never thought to do with their cars.