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GM Closing 4 Trucks and SUV Plants, Betting More on Smaller Cars

by Michael Graham Richard, Gatineau, Canada on 06. 3.08
Cars & Transportation

GM Chairman Rick Wagoner photo

Americans are Driving Less, Buying Smaller cars
The plate tectonics of the transportation sector are shifting and the new landscape is starting to become clearer. The change is particularly obvious in the US where fuel prices have been relatively low compared to most of the rest of the world for a long time. But the latest stats by the Federal Highway Administration don't lie: Americans are driving less. They're also buying more compact cars and hybrids.

Big Changes at General Motors
Another big sign of this changing world is GM's announcement that it will close 4 big SUV manufacturing plants and is thinking about selling its ailing Hummer brand.

The company doesn't seem to be burying its head in the sand either: “We don’t believe it’s a spike or a temporary shift. We believe it is, by and large, permanent,” said GM chairman Rick Wagoner.

Lets hope they learned from their $51 billion loses over the past three years and are really serious... Even in China.

Over all, G.M. will reduce its North American production to 3.7 million vehicles from 4.2 million. The moves should add $1 billion in cost savings to an existing target of reducing costs by $5 billion by 2011.

A New Hope?
But GM isn't just cutting. It's also going to invest more in its passenger cars and "crossover" vehicles. One of these new passenger cars is a Chevrolet with a turbo 1.4 liter engine -- it's been a while since GM has even looked at such small displacement. We bet that if they make it available, it will sell very well.

Chevy Volt photo

Chevy Volt Still Happening
Mr. Wagoner also mentioned that the plug-in series hybrid Chevy Volt would be available for sale "no later than the end of 2010." Lets hope that's true, because with a 40 miles (65 km) all-electric range, this car would be among the most fuel efficient on the market and could show other automakers that it is worth it to invest in plug-in hybrids.

Despite its mistakes and financial problems, GM is still an industrial giant and will be making a large portion of the cars sold in the future. We're pragmatic and we want to see it make cars that are as efficient as possible, and work on R&D for plug-in hybrids and electric cars, so we'll give them credit for making a step in the right direction. Just don't stop there! Keep going.

General Motors
GM's Chevy Volt Price Goes Up; Stereo, Wipers to Blame
Chevy Volt: An All-Electric Gasoline Hybrid?
Beijing Auto Show: Escalade SUV is GM's Star, Huge Cars are in Fashion

Compact Cars
Compacts and Hybrid Cars Becoming More Popular in the USA
Small Car Comeback in US
2007 Toyota Yaris - Sedan and Hatchback
Information About Honda's 2006 Civic Hybrid

More on GM Plants Shutting Down
G.M. Closing 4 Plants in Shift From Trucks Toward Cars
GM axes four SUV and truck plants

Comments (23)

It would be great if, besides making a single vehicle, manufacturers decided that entire fleets of vehicles should be made that run completely gas-free. Right now everyone in the car market seems jittery about that, but, its clearly what the American people are demanding.

Plug in hybrids are a start, what about fully electric cars, compressed air cars, and what if auto manufacturers started to develop and invest in larger scale transportation?

jump to top happyplanet [TypeKey Profile Page] says:

I completely applaud GM for making this switch. I really think that this is attributable to the buying power of the consumer. We CAN affect change if we focus and rally around it. Making those consumer choices is the way to go.

I dont beleive it. GM is going to listen to what consumers want instead of telling them?

Not in my America!

(ps - The volt is a bit of a joke but at least its a small nudge in the right direction) I bet one of the other start ups like Tesla will have a good all electric passenger vehicle before GM does. In fact i think some already do.

Ricks line: “We don’t believe it’s a spike or a temporary shift. We believe it is, by and large, permanent,” Thats one of the best things i heard all week. Actual acceptance at a corporate level, even if it is only from an economic point of view.

jump to top midnightjoker [TypeKey Profile Page] says:

Bring back the EV1 with more modern batteries, and design and they'd be back in the good books for sure!

jump to top Morgan Wadsworth says:

Too little, too late?

Unfortunately for GM, there probably aren't any buyers for the Hummer division.

jump to top Foraker says:

"Unfortunately for GM, there probably aren't any buyers for the Hummer division. "

I bet some asian company would gladly take it. SUVs are starting to be popular over there...

jump to top Anonymous says:

Morgan said:

Bring back the EV1 with more modern batteries, and design and they'd be back in the good books for sure!

Bring it back with the old batteries! The Southern California Edison electric vehicle test lab has been monitoring a fleet of electric RAV4's they use for meter readers. 100,000 miles on each of them and they are still going strong, still hold 80 - 100 miles of charge and none has needed new brakes. That's with NiMH batteries, not new fangled stuff.

The EV1 was fine just exactly the way it was. If they hadn't crushed them they could sell them now for a pretty penny.

jump to top Jon K says:

As long as they keep their hands off of the Corvette, I'm okay. Anything less than a V8 in there would be a sign of the apocolypse...

"As long as they keep their hands off of the Corvette, I'm okay. Anything less than a V8 in there would be a sign of the apocolypse..."

I bet that Tesla's next car around $50k will be a better performer than the 'vette. Can't say about styling yet, though.

jump to top Anonymous says:

I have a design bone to pick on the Volt. Look at all that glass. What happens to a building with over half the sun facing envelope made of glass? It becomes an oven as soon as the sun comes out. These design guys (and I bet they're all guys) still don't get it do they? Either they have to spend a lot of extra money per square meter of surface to cut solar gain with high tech glass; or they have to add a ginormous air conditioning tumor to keep up.

This is what happens when companies get so big that design gets broken up into component part segments and employees don't communicate with each other.

Bring on the competition. Got that Toyota?

jump to top John Laumer says:

I doubt the production Volt will be quite as angular.

jump to top Anonymous says:

Good move by GM, probably came at the 11th hour. I hope Ford and Chrysler will follow suit - I'm not holding my breath though. I hope Tesla is a success and I hope Hybrid Technologies gets off the ground. They could keep the heat on GM in case they get cold feet about this. Best news in a while.

jump to top B D HUnt says:

So when are they bringing back the GM EV1?
Can they call it the GMEV2?
=]

I drive a GM vehicle, (not by choice but it's what my parents got me so...yeah...) but I'm ready for the plug-in Prius or the plug-in whatever.
I'm holding on to my money until an affordable electric vehicle comes on the market.

jump to top Courtney says:

I'd actually prefer to buy a serial hybrid like the Volt than an all-electric passenger car, at least for the next generation or 2. Reason is: electric range vs. refueling time. If my hybrid gets 40 miles electric before using any gas and I recharge it any night, I'll only be using gas a few days a month. With an all-electric car (which might get 150 miles per charge- I doubt an affordable passenger car would be quite as efficient or light as the Tesla Roadster) I would only be helping eliminate those few days. Problem is, the one or two trips I make annually more than say 100 miles from home, my all-electric car would have NO WAY of getting me there any back without a 6 hour pause to charge my battery, whereas I can simply refuel the hybrid. Until there is a way for me to switch out a spent battery for a fully charged one at a road stop en route, I'll keep my ability to refuel quickly.

jump to top Anthony [TypeKey Profile Page] says:

Nice to see that GM is finally getting some sense beaten into them.

jump to top Icelander says:

"So when are they bringing back the GM EV1?"

The Volt essentially IS the second coming of the EV1. The EV1 would not have met current standards requirements, only had two seats, and cost far too much to build, and any hardware that the EV1 shared with other GM vehicles is likely no longer in production, so it would have had to have been completely redesigned, but the Volt surely incorporates any useful technology developed for the EV1.

The Volt will incorporate everything learned from the EV1, but with better batteries, newer technologry, more seats, and less expensive manufacturing techniques.

"I have a design bone to pick on the Volt. Look at all that glass."

That thing in the picture is not the Volt. It was a concept model used to get attention. It did that. From what I've seen, the production Volt will be a more conventional looking vehicle. The wind tunnel model photo that was circulating a while back looked more like a Cadillac CTS with softened edges than the concept model.

The glass roof will likely go away due to cost and weight. There are glass-roofed vehicles already, though. They are an expensive option and use a sliding shade to reduce the heat load.

jump to top gl says:

I'm saddened to hear rumors of the demise of Hummer. By the time the Hummer H6 or H7 came around, it might have been small and efficient enough for me to consider buying one. Oh well, I guess I'll manage to go without.

jump to top jon says:

The Volt is NOT a thing like the second coming of the EV1. GM said UP TO 40 miles before the engine kicks in. They also said that's if used in town. On a trip with few stops, 32 miles is the projected range. The EV1 would go more than 3 times that distance. GM is also talking about selling you the car, but leasing you the battery. There's not a chance that I would trust them to renew the lease. I'll buy from a conversion company before I'll let them tie a noose around my battery pack.,

jump to top Mark says:

I keep wondering if the Volt will still "work" if you remove the gasoline engine, and replace it with a second battery pack in parallel with the factory battery pack.

Just like the DIY'ers did with the Prius to make it a plug in hybrid, I imagine somebody out there will try.

I just wonder if the computer will get confused and not make it go, but maybe a smart DIYer will figure out how to make it happen.

Void the warranty I bet!

jump to top JC says:

People are applauding GM?
They have had their heads in the sand for so long, that instead of adapting to the changing market, they have to react with panic. The result is thousands of jobs directly or indirectly lost at the GM plant near me.
I usually tend to see things from management's perspective, if only becuase the Canadian Auto Workers union (CAW) is freakisly greedy. But the closure here was announced two weeks after a collective agreement was produced that would have a new, hybrid truck replacing the traditional truck in this plant.
GM management failed to adapt to the changing market, and screwed over a lot of people at one of their most productive plants in the world.

jump to top jorvay says:

"The Volt is NOT a thing like the second coming of the EV1. GM said UP TO 40 miles before the engine kicks in. They also said that's if used in town. On a trip with few stops, 32 miles is the projected range. The EV1 would go more than 3 times that distance."

I say it is. The last prototype of the EV1 included an internal combustion range extender. The Volt's system is based off of that technology. Extremely long battery-only range is only necessary for an electric vehicle if it has to be plugged in to go any further. With the ICE range extender, 32-40 miles on battery is more than enough. That is the distance most people travel in a day. For most people the ICE will rarely be used. For others it will be used more often, but will still be more efficent than a convetional vehilce, so it is both efficient and flexible.

Further, the EV1 has three major flaws - it only carries two people, it cost about $80,000 each to build 10 years ago (Imagine what it would cost now.) and it could not be built and sold now, because it wasn't built to current standards. The Volt addresses all of those issues plus upgrades the batteries to lithium-ion and increases the range but sacrifices pure electric range to achieve those goals.

GM did not start from scratch to build the Volt. They started with what they learned from the EV1 and went from there to meet new technical, financial and marketing requirements. Have you seen the battery pack for the Volt? It is identical to the EV1's except a fraction of the size.

"GM is also talking about selling you the car, but leasing you the battery. There's not a chance that I would trust them to renew the lease."

They haven't said whether or not this will be the case, but why would they not renew the lease on the battery? There is nothing to gain by it. Once they sell the car, they won't have the option to take them back like they did the EV1, so to refuse renewal of the lease would only serve to piss off and possibly be sued by Volt owners, and unlike the EV1, GM actually has a chance to eventually make a profit on the Volt. Besides, were GM to end the lease on the battery, an aftermarket battery supplier would likely step in to supply replacement battery packs.

If GM does fail, then say what you want, but until then stop undermining potential progress.

jump to top gl says:

I wonder why the experts at the top did not see this coming. Or, why they ignored the signs.

jump to top James H. says:

I have many friends that have retire from GM in Michigan, I hate to see any families get screwed of thier retirement. I feel Gm & Ford need to fire top heads in the Companies and get thier act together, I also dont want to see them get any funds, they will just waste it away

jump to top char hovland says:

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