Be a long time and a lot of effort and step up in build quality before they can even be considered as anywhere near German build quality, let alone be classed as "upmarket", if they ever get to that level. 
Skoda and Seat spring to mind. Both companies have been transformed massively in the last decade and a half from being cars you wouldnt be seen dead in to being the smart mans alternatives to VAG's more expensive brands. Now Vauxhall may not be the top of the crop of mainstream brands at the moment (I put that squarely down to Clarksons original review of the Vectra myself lol) but they are certainly not as far away from BMW and Audi at the moment as Skoda and Seat were from VW and Audi before VAG worked its magic and whilst there is no real premium brand in GM's arsenal to base a competitor for the established premium players, it would be more than possible to let Vauxhall or any of their other brands take the lead in developing a floorpan that could be used in the same way as VAG uses theirs for a range of cars to suit different budgets and expectations.
One other point I would make is that Ford had a period in the 90's where they just couldnt build a decent car any more, certainly in the handling stakes (similar to Vauxhall here, they have always had a rep for good engines plonked in ill handling/torque steering cars) and started losing money hand over fist. Then in one swift move, they completely changed their approach, sorted the fiesta's handling (still on the same floorpan as the pile of crap that was the mk3 fiesta) and introduced the focus and got a rep for good handling, reasonable quality cars that were lightyears ahead of their former products and started making them money again. Its not all that hard to sort out Vauxhalls fortunes and the Insignia is certainly a move in the right direction compared to the Vectra, it just needs a change in attitude from the parent company.
