This is a much more complex issue and industry than most people realize. Unfortunately, there has become a general bias against the Big 3, and perception (currently unwarranted, based solely on ignorance) that their quality is poor, they make vehicles that 'nobody wants', and all they make is 'gas guzzlers'. Between the 3 of them they sold millions of vehicles last year - so it's ludicrous to say that they build vehicles that 'nobody wants'. Quality is another issue. Look at JD Powers surveys that polls actual owners of the vehicles, not the hacks at CR that give anything with Toyota or Honda a good recommendation whether they have tested it or not. Buick is currently on top of the quality rankings. Ever heard of CAFE? If a automotive corporation's average fuel economy for vehicles produced in a given year is lower than the standard for the year, the feds levy fines on them. Over the 10 year period 1995 to 2005 the feds took in $640 million. Of that, over $500 million came from just 3 companies - BMW, Mercedes, and Audi. They didn't care about fuel efficiency or our government regulations - they just paid the fines (while tacking it onto the sticker price). But all the media crows about is the GM and Ford 'gas guzzlers'. But now that consumer awareness is higher about conspicuous consumption of fuel, they are rushing to put diesels and hybrids in everything so their well-heeled customers can boast about being 'green'. Yeah, just look at the buyers of Lexus 400h models at around $30K more than the regular model that get only a mile or two better mileage than the regular Lexus - which has mpg numbers similar to a pickup truck. Where's the value in that? One word: image.
So why do you see so many SUVs and trucks on the road? It's because that's exactly what consumers have wanted for the past 10 years. The auto industry builds them because that is what the consumer has been buying - and don't be so naive to think it's a Big 3 only issue. Look at the dozens of models that the Germans and Japanese have been producing. They include the heaviest, most expensive, and least efficient models you can buy - but for some reason they always get overlooked when it comes to pointing the finger at 'gas guzzlers'.
GM's new two-mode hybrid system in the full size SUVs and pickups (BTW that was an R&D joint venture with Chrysler and BMW) has the potential to save vastly more fuel per year in the US than all the tiny little poor-driving Priuses on the planet. Why? Because with full size Ford and GM pickup trucks being the number 1 and number 2 best sellers annually for decades, if you can achieve a 40% increase in efficiency in that segment, the country could collectively save vastly more fuel per year than having a million drivers of cars that get 25 or 30 mpg getting into Priuses (as an example). There are probably 200 full size pickups on the road today for every Prius. I however, do not want to drive an underpowered, ill-handling little suppository like the Prius - and most other folks don't either (the new Prius plant has been put on hold due to lack of sales). Vastly more SUVs are sold than the high mileage small cars, and they need to be made more efficient, and the two-mode hybrid system is a great way to do it. They get mid 20s real-world city mileage and can still pull 6000+ pound trailers. A lot of folks need towing capability and cargo capacity, and now you can have those capabilities without having to live with 10 mpg city numbers.
As to the question posted about why would you buy a Pontiac rather than a BMW? Well I'm amazed that that would even be asked. A Pontiac G8 GT stacks up very well against a BMW 5 series that costs nearly double. Most people don't have an extra $20-30 thousand dollars to throw around these days for a car that will cost more to buy, more to insure, and more to maintain & repair once it is out of warranty (I have owned BMWs - I know!). A Cadillac over a Mercedes? The Cadillac CTS was Car of the Year last year - not Mercedes. Plus, to me, the CTS styling is far better than the rather bland styling on a comparably-priced Mercedes model. An Mercedes quality has been severely lacking as of late.
As a closing comment, if we really wanted to save gas - right now, we could all start driving more intelligently. Coast more towards those red lights and stop signs, do not accelerate as hard, don't idle the engine outside of school for 15 minutes waiting for you child, stop circling the mall parking lot looking for that close parking spot so you can go into Ballys to work out, etc, etc,. And give the Big 3 a chance. Actually drive them rather than just badmouth them - they all make some very good vehicles. They are an integral part of our economy. They did not cause the economic crisis - they were just one of the first industries to get battered by the credit crunch because almost everyone that buys a car needs credit that the banks and Wall street screwed up. Almost every auto company worldwide has seen their sales drop and is getting government help right now, and in many cases they have been getting it for years in the form of national health care, subsidized R&D, and in some cases questionable and/or illegal trade practices and currency manipulation.
BTW - I am not an employee of the Big 3, nor is anyone in my family. I have been an auto enthusiast for decades (owned dozens of cars including models from the Big 3, Fiat, BMW, Lotus, Toyota, Acura, Honda) that has stayed informed, and tried to support local and national business when the product is right. I can buy Australian or Chilean wine for less than a comparable California or Washington St. variety, but I would prefer my dollars to stay circulating in our economy. In the past several years, the models, on average, coming out of the Big 3, have gotten much better in all areas and deserve consideration from the buying public - contrary to what you hear from the no-nothing politicians and parts of the media.