GM cuts warranty terms on Saab vehicles sold in U.S.

DETROIT (Reuters) - General Motors Corp (GM.N) cut warranty terms on Saabs sold in the United States to reduce costs, but will continue to provide free scheduled maintenance to compete with other premium brands, a GM spokeswoman said on Monday.

GM told dealers Friday it will cut its Saab extended powertrain warranty for 2009 models, effective immediately, to four years, or 50,000 miles, from five years, or 100,000 miles, spokeswoman Joanne Krell said.

The car maker provides free scheduled maintenance for three years, or 36,000 miles, on Saab vehicles in addition to the warranty, setting it apart from other GM vehicles, Krell said. Saab also has a four-year, or 50,000 mile, bumper-to-bumper warranty.

The Saab powertrain warranty will run concurrently with the bumper-to-bumper warranty.

The combination of a four-year warranty and the scheduled maintenance "makes sense to the import premium buyer, which is where Saab fits in the automotive landscape," Krell said.

The decision to cut warranty terms applied only to the Saab brand and not to other GM premier brands Cadillac and Hummer, Krell said. She did not have a dollar figure on the cost savings.

GM said earlier this month it planned to cut $10 billion in costs and sell assets totaling up to $4 billion to shore up its liquidity due to the downturn in U.S. auto industry sales that has most heavily affected large trucks and SUVs.

GM has been shopping its Hummer brand, but Chief Executive Rick Wagoner said on Friday the automaker remained committed to Saab, which analysts have long suggested could be divested to allow GM to narrow its brand focus.

The Saab warranty change has absolutely no connection to any discussion about GM's brands, Krell said.

Jerry York, who briefly served on GM's board two years ago as a representative for investor Kirk Kerkorian, had suggested GM divest Saab and Hummer among with other strategies that were rejected by GM executives at the time.

(Reporting by David Bailey, editing by Dave Zimmerman and Jeffrey Benkoe)