General Motors isn’t finished slashing products or dialing back plans to bolster its financial standing.
After unloading its near century-long Opel and Vauxhall holdings to France’s PSA Group, a move that came after failed attempts to return the European brands to profitability, GM plans to turn its focus on underperforming products in North America. There’s a chance that a model you hold dear could find its way to the chopping block.
“In [CEO] Mary Barra’s GM, everything is on the table,” Kelley Blue Book senior analyst Rebecca Lindland recently told Automotive News.
The trade publication cites internal sources who claim there’s more than a bit of anxiety within GM’s more distant operations about where the blade will fall next. Overseas markets have the most to worry about.
Following the Opel sale, Barra stated, “There’s a little bit more work that we’re doing in the international markets.” In the conference call, she stated her company’s strategy — that “every country, every market segment has to earn its cost of capital.”
This isn’t a new thing for GM. After boosting Russian vehicle production in 2012, GM announced it was vacating the market just three years later, after the Russian economy took a dive. Other recent rollbacks targeted the southeast Asian market.
In North America, every automaker’s game plan involves spending money to make money — on SUVs and trucks, mostly. However, even as new crossover and SUV models roll out, GM’s passenger car sales look grim. Slow sales of the new-for-2017 Buick LaCrosse point to the full-size segment’s malaise. Meanwhile, overstocked inventories of other cars has prompted the automaker to cut shifts and temporarily shutter plants.
The jury’s out on whether GM is so gung-ho on cost-cutting that it would drop models from its lineup. It could just as easily cut investments and let certain models wither on the vine. Then, the freed-up money could be put to work developing and building higher-profit utility vehicles.
[Image: General Motors]