GM Cash Crunch Crisis Continues: SUV and Pickup Re-Design Iced

by Robert Farago

June 19th, 2008 8:29 AM

gm cash crunch crisis continues suv and pickup re design iced

Yes, GM's light truck sales are in the toilet. Yes, it makes sense to plan their future carefully, given questions about [the loopholes in] new federal fuel economy regulations. But it's also true that GM's stop/start development process hurts its competitiveness. If GM wants to maintain its co-domination of this wounded though high-profit sector– and why wouldn't they?– the automaker would do well to remember that the new Toyota Tundra and Sequoia are still out there, somewhere. AND there's a new Ford F-150 and Dodge Ram coming down the pike. But no. GM has revealed that the next gen trucks– scheduled to go into production in 2013– have been postponed. Bottom line: GM's saving $300m. Bottom line: GM's cash position must dire. Even The Detroit News gets it, kinda. "GM has said it needs more and better passenger cars for the U.S. market. But money to develop new vehicles is tight. The automaker, which hasn't turned a full-year profit since 2004, is burning cash, losing $3.3 billion in this year's first quarter alone." Over at RenCen, the spin starts there. "GM's Wilkinson said the automaker is confident that the existing trucks can compete with other companies' new models. Even without a total makeover of the platform, GM can change anything from the trucks' powertrains to the interiors. 'Our intention is to remain a leader in the segment.' What was that about the road to Hell?

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John Horner on Jun 19, 2008

Now if only GM would cut all executive salaries in half! None of those guys would go hungry, cash would be saved and the rest of the company might start to believe that things are going to be different. Ice cube in hell.

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The Luigiian on Jun 19, 2008
Ice cube in hell. Dante's Inferno hell? If I recall, it was really, really cold in Dante's Inferno Hell, which means that ice cube would last a long, long time. Snowballs would also have a good chance in Hell. I've never understood that metaphor, and I think Dante would agree. I think this is a stupid decision. On the other hand, short term it'll sell more trucks. Why? Because people won't feel a need to wait for a newer, better model to come out from GM. Why should I wait for a better Colorado when I know they're not going to do anything with the platform for upwards of eight years anyway? Speaking of that truck, I'll say what I said on Autoblog: Give it a mild hybrid, give it a six-speed automatic, or give it both. It'll sell a lot more of those things. Think about it: the Ranger is currently top fuel economy on the market. Once it's gone, if Chevy had the best fuel economy it might just be able to get the bulk of the fleet sales, not to mention a lot more of the recreational sales. The F/E on the Saturn Vue Hybrid is 28 mpg, up from 22 mpg base. The Colorado could potentially get upwards of 26 mpg from its four, which is most powerful in its class. If advertised correctly, it could sell. I mean, that's two mpg away from a Ford Focus.

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Skooter on Jun 19, 2008

"stupid, stupid, stupid, stupid" This is how you describe an American car company. If same decision is made by Asian company please substitute with "flexible, smart, able to adjust to demand, etc."

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RogerB34 on Jun 19, 2008

Volt will suck up any development money. GM has rolled the dice.

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