GM to Make 'Significantly Lower Investments' in Sedans in North America

[RadicalX]

Ford’s recently confirmed decision to phase out almost its entire car lineup in the U.S., except for the Mustang and the upcoming Focus Active, to put most of its efforts into SUVs and trucks, has raised questions about the other two of the Detroit Three automakers. Fiat Chrysler has already made a pretty big commitment to trucks and SUVs in its decision to phase out the Chrysler 200 and Dodge Dart and invest more heavily in Jeep and Ram, but what about the biggest of the three, General Motors?

According to Reuters, GM CFO Chuck Stevens said the conglomerate has “already indicated that we will make significantly lower investments” in sedans in North America in a conference call with investors. He went on to say that GM executives “look at these car lines on a weekly basis, at how to drive performance (and) cost efficiencies.”

So every week GM execs get together to decide if they want to kill the Volt and the Impala. Those are just two models that have already been rumored to be axed, the others being the Chevy Sonic (which is reportedly already on death row), Buick LaCrosse, Cadillac CT6, and Cadillac XTS.

But GM making “significantly lower investments” in sedans for the U.S. doesn’t necessarily mean they’re dead. For example, Chevy just gave a moderate facelift to the Spark, Cruze, and Malibu which means those cars are likely safe, at least for a few years. It’s easy to forget about the Chevy Spark, but it holds a fairly significant market share in the city car segment and with the Focus and Fusion soon to be out of the way, that just means more market share by default for the Cruze and Malibu.

Think about it. A few years from now, if you want a compact or midsize car from a non-luxury American brand, Chevy will be your only option. The smallest Dodge car you can get is the Charger and Ford is exiting the game almost entirely. That means a good chunk of market share in those segments, although they’re declining, is Chevy’s for the taking.

As for Buick, I wouldn’t be surprised to see it turn completely into a crossover brand. That’s what its clientele wants and Buick is doing a pretty good job catering to that market. If the Impala is eliminated, there would be no reason to continue making the LaCrosse with which it shares a platform. There’s also the issue of the Buick Regal being based on the Opel Insignia and GM no longer owning Opel. That’s probably another one that will be killed off after its current life cycle is up.

As for the future of Cadillac sedans, GM’s luxury brand still has some serious catching up to do in terms of crossovers. Last we heard, the XTS was going to die out at the end of its current life cycle with no replacement, the CTS and ATS are going to be replaced with one sedan called the CT5, and another, smaller sedan would be added to the lineup to compete with the likes of the Audi A3 and BMW 2-Series. However, that plan was under recently ousted CEO Johan de Nysschen so the whole thing could be scrapped for all we know.

So, don’t expect GM to give up on sedans and small cars quite yet, especially now that all of this juicy market share is up for grabs thanks to Ford.

http://www.thedrive.com/news/20462/gm-to-make-significantly-lower-investments-in-sedans-in-north-america

[Assimilator]

Chevy and Ford could end up exiting the sedan market at roughly the same time. Fusion still has 2 years to go and just got an update for 2019 along with Malibu. Sonic and Impala might be shuttered before Fiesta and Taurus, or around the same time. What's obviously different up front is Focus and Cruze, even if Focus is staying around it's taking an interesting new direction which may or may not inspire Chevy to do something similar, but I suspect the Cruze fleet will stick around longer regardless. Spark....why?

 

Not sure what the hell is going on with Buick, they seem to make obviously dumb decisions to invest into cars that they must have known would not do well while doing very well with Crossovers. If there is any company that appears to be shooting blind, it's GM. GM probably needs more investor motivation to get things into shape.

 

As for Caddy, I'm pretty sure they need to make a bunch of decisions at this point.

[twintornados]

What of the Japanese and Korean sedan builders?? Is the "Big 2 and 1/2" going to cede the market to them completely??

[jpd80]

i'm sure that Toyota and Honda will make a fortune chasing nickles in front of the steam roller of change.

It's almost inevitable that Utilities will eventually gonbble up those car sales too, they're just the last bastions..

 

Meanwhile Ford and Gm refocus on products that people want and make more profit

could Ford be so lucky as to have all of it plants running three shifts post 2020?

Edited April 28, 2018 by jpd80

[fuzzymoomoo]

i'm sure that Toyota and Honda will make a fortune chasing nickles in front of the steam roller of change.

It's almost inevitable that Utilities will eventually gonbble up those car sales too, they're just the last bastions..

 

Meanwhile Ford and Gm refocus on products that people want and make more profit

could Ford be so lucky as to have all of it plants running three shifts post 2020?

Not as long as they insist on not doing a major renovation of FRAP.

[J-150]

i'm sure that Toyota and Honda will make a fortune chasing nickles in front of the steam roller of change.

It's almost inevitable that Utilities will eventually gonbble up those car sales too, they're just the last bastions..

 

Meanwhile Ford and Gm refocus on products that people want and make more profit

could Ford be so lucky as to have all of it plants running three shifts post 2020?

I wouldn't rule them out. They have their own range of CUVs and the cash to develop more.

[Fgts]

Point is GM is still making sedans while Ford wont..

[akirby]

Point is GM is still making sedans while Ford wont..

And if Ford is right and executes on their plan theyll be making a lot more money.

Edited April 29, 2018 by akirby

[Fgts]

And if Ford is right and executes on their plan theyll be making a lot more money.

Because GM is not making any CUVs?...

[jpd80]

Because GM is not making any CUVs?...

 

No, Just that Ford will be making a lot more money compared to now.

 

Barra has said no capital on cars, I wonder if that means what I think it does...

Edited April 29, 2018 by jpd80

[akirby]

Because GM is not making any CUVs?...

They’re not making as many hybrid and phev CUVs as Ford is planning to do. At least it doesn’t appear that they are.

[twintornados]

I will admit that I had always been a sedan buyer with my last true sedan being a 2012 Ford Fusion SEL....truly enjoyed that car. In 2014, I saw a Lincoln MKX that caught my eye, took it out for a spin and bought it...only complaint was that the MKX got lower mileage with it's V6 and heavier GVW but I enjoyed the luxury and size for the next four years and 4 months....She was well used and enjoyed, rolling up over 100K miles with ease and comfort. Traded her in for a 2017 MKC with a 2.3L Ecoboost motor and while it was an adjustment getting used to the smaller size (not by much, interior is designed to feel larger that it actually is, biggest loss is rear leg room but I don't ride back there, lol.) the increase in mileage is welcome.

 

So, here I am, enjoying my second SUV/CUV and thinking, I don't see me ever buying a sedan again....I am patiently awaiting the 2020 Bronco to see if a Ford could get me out of my Lincoln....love the luxury of it.

PS: When the girlfriend was shopping for a replacement for her 2010 Escape...we took a 2015 Escape out and while, yes, the MKC is based on the Escape...they are worlds apart. As an aside, she ended up with a Subaru Forester since she likes the whole "boxy SUV" styling...maybe she'll get a Bronco....we'll see...

Edited April 29, 2018 by twintornados

[Fgts]

 

No, Just that Ford will be making a lot more money compared to now.

 

Barra has said no capital on cars, I wonder if that means what I think it does...

She said little investment in cars but don't mean they stop making cars for the US, even if she made the decision today it would take years before a sedan platform runs it's course also most GM sedan platforms are married to the CUVs, one example of how long GM milk platforms is the W-Body went 28 years before production ended.

[Fgts]

Theyre not making as many hybrid and phev CUVs as Ford is planning to do. At least it doesnt appear that they are.

Plenty of future GMs will have a Voltec option or a pure EV.

[rperez817]

Plenty of future GMs will have a Voltec option or a pure EV.

 

GM is among the leaders in electrification of cars and light trucks. Tesla is too. And now Ford is getting geared up to be a major player in electrification as well. It's great that all three American automakers will be very competitive with any other global automaker in this area.

[jpd80]

She said little investment in cars but don't mean they stop making cars for the US, even if she made the decision today it would take years before a sedan platform runs it's course also most GM sedan platforms are married to the CUVs, one example of how long GM milk platforms is the W-Body went 28 years before production ended.

That's not unlike Ford with Taurus =Explorer, Focus=Escape, Fusion=Edge but what we're seeing

is Hackett switching three car plants to Ranger/Bronco, C2 based Utilities, and EVs.

 

There are still lots of valuable car sales to be had, the difference between Gm and Ford is that

Mulally pruned all the excess production capacity, so the choice for Ford was easy, it has to

drop car production if it wants to build other products. GM has the luxury of having a lot more

car and utiltiy plants most running well below capacity so it will be interesting to see how GM plays this..

[rmc523]

She said little investment in cars but don't mean they stop making cars for the US, even if she made the decision today it would take years before a sedan platform runs it's course also most GM sedan platforms are married to the CUVs, one example of how long GM milk platforms is the W-Body went 28 years before production ended.

 

You don't think a reduction in sedan investment won't mean dropping a few models?

 

Fusion will be around a few more years as well (I think it was a mistake to announce so early, as you're only going to create a self-fulfilling prophecy "well sedan sales are down" - sure because you said you're dropping the model years ago).

[jpd80]

 

You don't think a reduction in sedan investment won't mean dropping a few models?

 

Fusion will be around a few more years as well (I think it was a mistake to announce so early, as you're only going to create a self-fulfilling prophecy "well sedan sales are down" - sure because you said you're dropping the model years ago).

So are we talking about MY2020 being Fusion's last year?

If so, that's not really so far away....

Edited April 29, 2018 by jpd80

[rmc523]

So are we talking about MY2020 being Fusion's last year?

If so, that's not really so far away....

 

I suppose not. Sounds further away than it is.

 

Makes the 2019 minor refresh (new bumpers) all more puzzling.

[2b2]

So are we talking about MY2020 being Fusion's last year?

If so, that's not really so far away....

afaik the video didn't specify (or I missed) being MY or thru the end of CY2020 *at Least*

 

kinda remembering the latter

[akirby]

GM is among the leaders in electrification of cars and light trucks. Tesla is too. And now Ford is getting geared up to be a major player in electrification as well. It's great that all three American automakers will be very competitive with any other global automaker in this area.

 

Ford has been doing hybrids since 2005 and I’m sure they’ve sold a lot more hybrids than GM has including plug in hybrids.

[rperez817]

Ford has been doing hybrids since 2005 and I’m sure they’ve sold a lot more hybrids than GM has including plug in hybrids.

 

Good points sir. When it comes to electrification, Ford's strengths have been regular gas-electric hybrids and plug in hybrids. GM's strengths have been pure EV and range extended EV.

 

In the next few years, both Ford and GM should have a broad range of electrified vehicles. From micro hybrids to advanced pure EVs. Tesla of course will continue its focus on advanced pure EV.

[fuzzymoomoo]

Tesla of course will continue its focus on advanced pure EV.

If they are still in business 5 years from now....

[twintornados]

Look back over the time span of the automobile from the start of the modern assembly line and the Model T and up through today. You'll see market forces drive the innovations and design trends of the various makes and models...remember the 1970's when the best selling cars were station wagons and giant two door sedans referred to a "personal luxury coupes"...both of those segments are long gone....even the vaunted minivan market is a shell of its former self...and that didn't take nearly as long to kill off as station wagons took....

[silvrsvt]

PS: When the girlfriend was shopping for a replacement for her 2010 Escape...we took a 2015 Escape out and while, yes, the MKC is based on the Escape...they are worlds apart. As an aside, she ended up with a Subaru Forester since she likes the whole "boxy SUV" styling...maybe she'll get a Bronco....we'll see...

 

I guess my wife isn't as weird as I thought she was-she really liked her 2010 Escape and she likes her 2017, but she likes the Boxy styling of the 2010 better-She said she might look at the Baby Bronco as her next car-since that looks like it will be more boxy looking then the Escape.