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Jul-06-2008GM to Speed Decision on Mini Car for US(topic overview)
CONTENTS:
- GM may bring the production version of the Chevrolet Beat to the U.S., people familiar with the plan said. (More...)
- GM's sales have tumbled 16.3 percent this year, more than the market's overall 10.1 percent decline, as soaring gas prices have put customers off from buying large vehicles. (More...)
- The consideration by GM comes after the company's U.S. sales tumbled 18.5pc last month, while rivals Ford and Toyota also reported dwindling sales, down 28pc and 11.5pc respectively. (More...)
- No plans yet for actual construction of the Beat, except that engineers are finishing the final configuration, and GM hasn't said where the car would be manufactured. (More...)
- Now the world's biggest automaker is considering producing something called a Beat which is a is a front-wheel-drive, three-door hatchback powered by a 1.2-litre turbocharged gasoline engine. (More...)
- Smart cars struggle to even fill half of a conventional parking space and are much smaller than BMW AG's stylish Mini products, for example. (More...)
- Small cars like the Aveo and Toyota Yaris are among the fastest-growing segments of the U.S. and Canadian markets as a growing number of buyers move away from larger sedans and trucks. (More...)
- This mean-lookin' machine may wind up in your rear-view mirror someday, as GM is thinking hard about bringing this 40mpg car to America.'' (More...)
- The vehicle would need to be built to meet U.S. safety standards. (More...)
SOURCES
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GM may bring the production version of the Chevrolet Beat to the U.S., people familiar with the plan said. The car, which would normally be reserved for markets such as Asia and Latin America, gets as much as 40 miles a gallon, a fuel efficiency topped in the U.S. only by hybrids. The possible American introduction of the Beat would be one step in a fleet downsizing and shift away from fossil fuel-based vehicles that the people said is already under way at Detroit- based GM. Resigned to $4-a-gallon gasoline and stricter pollution rules, the largest U.S. automaker has recognized that its response must go beyond the mothballing of large truck plants, the people said. "This is a very big change for GM,'' said John Wolkonowicz, an analyst at Global Insight Inc. in Lexington, Massachusetts. "They have no choice. [1] General Motors may begin selling a mini-car in the U.S. to win back buyers deterred by record fuel prices. GM may sell the Chevrolet Beat - normally be reserved for markets such as Asia and Latin America - in the U.S. It gets as much as 5.9 litres per 100km, a fuel efficiency topped in the U.S. only by hybrids. The possible U.S. introduction of the Beat would be one step in a fleet downsizing and shift away from fossil fuel-based vehicles that is already under way at Detroit- based GM. Resigned to $4-a-gallon petrol and stricter pollution rules, the largest U.S. carmaker has recognised that its response must go beyond the mothballing of large truck factories. "This is a very big change for GM,'' said John Wolkonowicz, an analyst at Global Insight in Lexington, Massachusetts. "They have no choice.[2]
BMW has the Mini Cooper. GM will probably import its Chevrolet Beat to America to offer a car which gets higher miles-per-gallon than any other vehicle the auto company markets here. According to Bloomberg, "Besides the Beat, GM is weighing a list of options for refocusing its auto lineup on fuel efficiency rather than performance. They include the U.S. introduction of a small pickup popular in Latin America." GM still faces the extremely difficult question of whether it will run out of time and money before it can overhaul most of its product line to make it attractive in the environment of $4 gas. It is unlikely.[3] The price was the lowest since 1954 adjusted for splits, according to Global Financial Data in Los Angeles. Besides the Beat, GM is weighing a list of options for refocusing its auto lineup on fuel efficiency rather than performance. They include the U.S. introduction of a small pickup popular in Latin America and an expansion of the number of versions of the Volt plug-in electric car, the people said. GM is also trying to increase production and speed up availability of the successor to the Chevy Cobalt sedan and develop a fuel-efficient alternative to the Cadillac Escalade sport-utility vehicle, they said.[1]
GM fell 15% after Merrill downgraded the stock to "underperform'' from "buy.'' Besides the Beat, GM is weighing a list of options for refocusing its car line-up on fuel efficiency rather than performance. They include the U.S. introduction of a small pick-up popular in Latin America and an expansion of the number of versions of the Volt plug-in electric car.[2]
GM may bring the production version of the Chevrolet Beat to the U.S., people familiar with the plan said. The car, normally reserved for markets such as Asia and Latin America, gets as much as 40 mpg, a fuel efficiency topped in the U.S. only by hybrids.[4]
Tiny cars, smaller than a Chevrolet Aveo or Toyota Yaris, have long sold well overseas, through conventional wisdom has long been that space-loving Americans would be unwilling to downsize so drastically. That assumption may be changing, in part because of the runaway success of Daimler AG's (DAI) Smart Fortwo, the smallest gas-powered car in the U.S. market. General Motors Corp. (GM), scrambling to shift its portfolio away from trucks, is seriously considering bringing the next-generation Chevrolet Beat minicar, a two-door that gets 40 miles per gallon, to the U.S. Meanwhile, Ford Motor Co. ( F) is watching the Smart car closely.[5] General Motors Corp. said it is giving a higher priority to deciding whether it will bring the next-generation Chevrolet Beat mini car -- a vehicle it sells overseas -- to the U.S. market in the 2012 timeframe. Such a move would increase the stakes on GM's bet the U.S. market is undergoing historic change.[6]
General Motors has revealed it is considering a new Chevrolet mini car for the North American market to try competing with vehicles like the Honda Fit and Toyota Yaris. GM has been struggling to rework its product lineup in this new world of nasty gas prices.[7] Associated Press July 4, 2008 The Beat by General Motors is seen at the North American International Auto Show in Detroit. DETROIT General Motors Corp. is considering a new Chevrolet mini-car for the United States as it reworks its product lineup to cope with a dramatic consumer shift from trucks to cars linked to high gas prices, a spokesman said Thursday.[8]
Sharp market turn has automaker thinking of taking its lineup to smaller extremes. General Motors Corp. is reviewing its product range following radical shifts in demand in the U.S. auto market and may even bring a minicar to the United States that was originally designed for customers in Asia and Latin America.[9]
Automakers - General Motors Corp., which popularized the 3,500-kilogram Hummer, may begin selling a mini-car more than a foot shorter than anything else it markets in the U.S. to win back buyers deterred by record fuel prices.[10] General Motors may begin selling the Chevrolet Beat, a minicar more than a foot shorter than anything else it markets in the U.S., to win back consumers deterred by record fuel prices, reports Bloomberg News.[11] DETROIT -- General Motors, which popularized the 7,800-pound Hummer, may begin selling a minicar more than a foot shorter than anything else it markets in the U.S. to win back buyers deterred by record fuel prices.[4]
General Motors, the maker of the iconic off-road Hummer, may be gearing itself up to sell mini-cars in the U.S., in order to win back market share as soaring fuel costs turn Americans off gas-guzzlers.[12] COMBINED WIRE REPORTS July 4, 2008 General Motors Corp., which popularized the 7,800-pound Hummer, may begin selling a mini-car more than a foot shorter than anything else it markets in the United States to win back buyers deterred by record fuel prices.[13]
As part of a complete review of its lineup aimed at addressing rising gasoline prices in North America, General Motors Corp. is weighing whether it could bring a minicar here originally destined for buyers in South America and Asia.[14]
GM's sales have tumbled 16.3 percent this year, more than the market's overall 10.1 percent decline, as soaring gas prices have put customers off from buying large vehicles. The automaker has already taken major steps to adjust: It has announced big cuts in truck production and permanent plant closures; it has said it may sell its Hummer brand; and it plans to bring more fuel-efficient vehicles to the market. Mark LaNeve, GM's vice president for sales in North America, said earlier this week that the automaker would launch 13 midsize or smaller cars and crossovers in the next 18 months. [9] The automaker has traditionally made money selling big trucks and SUVs -- vehicles that are falling out of favor now that gas prices are above $4 a gallon. In its effort to offer small cars in the United States and Europe without losing money on the business, GM has tapped the resources of its GM Daewoo Auto & Technology operations in South Korea.[9]
There's never been as rapid a shift in consumer demand in the history of the auto industry.'' GM, turning 100 this year, has few options to re-inventing itself. The company reported its largest annual loss in 2007, $US38.7 billion, after a tax accounting change, and hasn't had a profitable year since 2004. The carmaker's U.S. market share hovers at its lowest since 1925, and last year GM was 3000 cars away from being dethroned by Toyota as the world's largest carmaker.[2] GM spokesman Dee Allen said bringing the Chevrolet Beat, which is about the size of a Honda Fit or Toyota Yaris mini-car, to the U.S. is among the options the company is studying. "It is certainly one of the things that is being looked at from a portfolio perspective," Allen said. The comments came as GM shares have been trading near their lowest levels in more than a half-century, raising investor worries about the automaker's future and its ability to adjust quickly to demand for more fuel-efficient cars.[8] The company is now planning to launch a new Chevy branded mini car in the market which would be fuel efficient and cheap. GM is considering bringing the Chevrolet Beat model in their home market. Chevrolet Beat is going to take on Honda Fit or Toyota Yaris in international market and it might give them the much needed boost in USA.[15]
GM showed a concept version of the Chevrolet Beat, an 11 1/2 -foot, two-door hatchback, at the New York auto show last year.[9] GM showed the car, which is larger than Daimler AG's Smart but smaller than GM's Chevrolet Aveo subcompact, at the New York Auto Show last year.[14]
GM debuted the Beat concept at the 2007 New York Auto Show alongside two other tiny Chevys, the Groove and Trax. The auto maker then opened up a worldwide online voting campaign, asking the public to pick which car they liked best.[5]
GM unveiled the Beat with two other ultra-small cars as concepts at auto shows last year. They are targeted toward young buyers in urban markets.[7]
"We always thought we'd do it at some point, but now it obviously enjoys a much higher priority," GM Vice Chairman Bob Lutz wrote in an email. GM's U.S. sales were down 16% in the first half of the year, and the auto maker can't move fast enough to meet demand for its smallest, most fuel-efficient cars.[6] Sales of small cars across the U.S. rose 31pc in the first six months of the year, with sales of the biggest SUV's falling a corresponding 31pc. GM has reassigned many of its engineers to its new mini-car project, and has reportedly suspended SUV and truck programs until demand returns to the market.[12]
At about 138 inches (3505 millimeters) long, the Beat would be among the smallest cars sold in the U.S. Only the 106-inch Smart car is shorter. Sales of the smallest cars in the U.S. have risen 31 percent in the first half this year as the industry total fell 10 percent and the largest SUVs 31 percent.[1] GM is one of several players looking to eventually enter a mini-car segment that currently is almost nonexistent. Daimler AG's Smart cars are the only serious mini cars on the market, having gone on sale earlier this year, and thus far have shattered expectations.[6]
BMW introduced the Mini to the American market in 2002, reaching record sales of 42,045 cars last year. The German carmaker sold 26,400 Mini's in the first six months of this year - putting it on course for another record.[12]
GM may also expand the Volt electric car program, the people said. GM Vice Chairman Bob Lutz, 76, said last month the company currently plans to build about 60,000 Volts a year after they go on sale in late 2010.[1] The vehicle's sales through June hit 11,400 in the U.S., putting the company well on track to shatter the initial target of 16,000 sales in the first year. "At first people were using this as their second or third vehicle," said Smart USA marketing specialist Jessica Gamarra.[5] U.S. mini-car sales are up nearly 31 per cent for the first half of the year, even though the total U.S. auto market is down almost 20 per cent.[7]
GM has declined to discuss the Beat's price, but vice chairman Bob Lutz said last year that the automaker's mini-cars ideally would start at about $10,000 in the U.S. market.[13] The carmaker's U.S. market share hovers at the lowest level since 1925, and last year GM was 3,000 cars away from being dethroned by Toyota Motor Corp. as the world's largest automaker.[1]
GM also is under pressure to conserve cash, with Wall Street analysts expressing concerns that the U.S. automaker might face a liquidity crisis next year. GM's shares fell below $10 Wednesday, to their lowest level in more than 50 years, after brokerage firm Merrill Lynch voiced the possibility of bankruptcy. They rebounded slightly Thursday, closing up 1.4 percent at $10.12. In a research note Thursday, J.P. Morgan analyst Himanshu Patel said GM was burning through cash and may need to raise capital later this year. He described several possible sources of financing for the company, as it struggles through a difficult stretch. "GM has large, profitable, unencumbered foreign operations that could be pledged for potentially $8 billion to $11 billion in secured loans," he said. It also could seek to push back the timing for its 2010 contribution to the Voluntary Employees' Beneficiary Association, said Patel, who has an "overweight" rating on GM stock although he considers it "high risk."[9] "We are looking at and reviewing our entire portfolio, not just because gasoline is $4 but because of stricter government fuel economy regulations,'' GM spokesman Dee Allen said, referring to U.S. requirements that automakers reduce fuel use 40 percent by 2020. He declined to discuss specific projects. Wagoner said June 3 that GM was considering all of its options for Hummer, including selling the brand.[1]
GM is struggling to compete against the Japanese automaker in the U.S. market as customers now prefer to buy fuel efficient cars rather than trucks and jeeps.[15] If GM brought the Beat to the U.S. market, it would be one of the smallest cars on the road, though larger than Daimler AG's 9-foot, boxy Smart two-seater.[9] Besides two hybrid models, the only car in the U.S. that comes close to the Beat's projected fuel efficiency is Daimler AG's Smart car, with 36 mpg, according to Yahoo! Autos.[1] Ford, still without a subcompact to challenge cars like the Aveo, Yaris, Honda Fit and Nissan Versa, plans to bring the subcompact Ford Fiesta to the U.S. in 2010, as a sedan and hatchback. The auto maker said Thursday that, while it has no plans to bring its even smaller Ford Ka mini car to the U.S., it is monitoring the Smart.[5] Initially a hit in trendy, coastal metro areas, Smart U.S. is now putting dealerships in cities like Tulsa, Okla., and Omaha, Neb. The company said buyers are using the cars as their primary mode of transportation. Ford Motor Co. said Thursday it has no plans on the table to bring its micro-sized Ka mini car to the U.S., but it is monitoring the success that Smart is having.[6]
The consideration by GM comes after the company's U.S. sales tumbled 18.5pc last month, while rivals Ford and Toyota also reported dwindling sales, down 28pc and 11.5pc respectively. Shares in General Motors plunged to their lowest level since September 1954 as fears for the company's future escalated. [12] GM reported a 21 percent plunge in U.S. sales of pickups, SUVs and vans for the first six months.[1] Models classified as subcompacts or smaller account for 6 percent of total U.S. auto sales -- compared with 27 percent of the European market.[9]
Auto analysts say that segment could grow if more models were available. GM's considerations about bringing the Beat to the U.S. market don't "mean that it's coming tomorrow," Allen said.[9] GM spokesman Dee Allen said yesterday bringing the Beat here is among the options the company is studying. "This is a very big change for GM," said John Wolkonowicz, an analyst at Global Insight Inc. in Lexington, Mass. "They have no choice.[13]
The next generation of GM mini cars, on which the Beat is based, is slated to debut in several global markets in coming years and should be capable of at least 40 miles per gallon.[6] GM probably faces cash issues by the middle of next year. It will take longer than a year to get the Beat and other fuel-efficient cars distributed throughout the U.S. The factories that make the products will also have to increase capacity, which could take several quarters.[3] Designed at GM's South Korean facilities, the Beat is smaller than the Chevrolet Aveo subcompact, which was also designed in South Korea and is the smallest car in GM's U.S. lineup.[9] If GM brought the Beat to the U.S., the move would mark the auto maker's entry into a nearly nonexistent market for super-small cars.[5]
GM is also weighing the U.S. introduction of a small pickup popular in Latin America and more versions of the Volt plug-in electric car.[13] Usually sold only in Asia and Latin America, GM is thought to be developing a version of the Chevrolet Beat for America's highways, according to a report by Bloomberg.[12]
Don't you just love the way some cars take on an actual head-on personality.'' Engineers must love to do this sort of thing. It's called the Beat, and it's a car that would normally be sold in other markets, such as Asia and Latin America.''[16]
No plans yet for actual construction of the Beat, except that engineers are finishing the final configuration, and GM hasn't said where the car would be manufactured. [16] I hope GM follows through and brings this to the U.S. sooner rather than later. It's a good concept and I think it will catch. My understanding is that aside from the gas mileage this car has an extremely low sticker price as well.[16] With the high price of gas, and GM's plunging losses ($38.7 billion in 2007), the company that brought you the Hummer may just have to re-invent itself.''[16]
GM rose 14 cents, or 1.4 percent, to $10.12 at 1:15 p.m. in New York Stock Exchange composite trading that was shortened by the July 4 U.S. holiday.[1] The small pickup GM is considering for the U.S. would be similar to the Chevrolet Montana, according to the people with knowledge of the plans.[1] The Chevrolet Beat finished first in online voting by 1.8 million people world-wide on three General Motors mini-car concepts.[6] How big is a mini-car?'' The Beat would come in at about 138 inches, 11.5 feet in length.'' You may have seen this concept model at the April 2007 Auto Show in New York.''[16] The automaker unveiled the Beat as a prototype at the New York auto show in April 2007, along with two other 40 mpg Chevy small-car concepts.[1]
Now the world's biggest automaker is considering producing something called a Beat which is a is a front-wheel-drive, three-door hatchback powered by a 1.2-litre turbocharged gasoline engine. It would retail for about $10,000 in the U.S. market. [7] In November, GM said it approved a model based on the Beat prototype for markets outside the U.S. and Canada starting next year.[1] The Beat, however, wouldn't arrive in the U.S. for at least a couple of years, GM's Lutz said.[5]
The Beat, to be built in South Korea, will be rolled out in other global markets faster than it would be in the U.S., Allen said. He did not know when the car might be sold elsewhere or in the U.S. The car still must be engineered to meet U.S. safety and emissions standards, he added.[8]
The automaker is producing fuel-efficient gas-electric hybrids, too, and it is working on ultra-clean hydrogen-powered cars for the future. GM already was reviewing its lineup and seeking ways to produce more fuel-efficient cars "because of legislation with a 35-mile-per-gallon requirement," Allen said. "That's certainly something that impacts our portfolio planning."[9] "Everything is under review," said GM spokesman Dee Allen. While the automaker's executives continually review their lineup, this examination might lead to bigger changes, he said.[9]
Already, GM has reassigned engineers to many of the projects, according to the people familiar with the planning. The company is taking them from SUV and truck programs suspended while awaiting the return of customers. Now, these people said, GM sees no point in waiting. "This is the biggest change that we have seen at GM in three decades in terms of engineering,'' said Jim Hall, principal of 2953 Analytics, an automotive consulting firm in Birmingham, Michigan.[1] "The Volt is going to have far more variations than people imagine,'' said Hall, who studies GM's plans for future models.[1] GM is conducting major surgery on the product plans it had set for the next decade, scrambling to react to falling demand for vehicles that consume a relatively large amount of gasoline.[6] The possible American introduction of the Beat would be one step in a fleet downsizing and shift away from fossil- fuel-based vehicles that the sources said is already underway at Detroit-based GM.[4] GM Daewoo, acquired in 2001, developed the Aveo and designed the smaller Beat, with mileage estimated at 40 miles per gallon.[9]
Smart cars struggle to even fill half of a conventional parking space and are much smaller than BMW AG's stylish Mini products, for example. [6] "Now, we're seeing a lot of people considering the Smart as a primary mode of transportation." Mini cars are attractive because they deliver high gas mileage, but are generally less expensive than gas-electric hybrids like the Toyota (TM) Prius.[5] Daimler was first to the mini car market at the start of 2008 with the Smart Fortwo.[5]
Small cars like the Aveo and Toyota Yaris are among the fastest-growing segments of the U.S. and Canadian markets as a growing number of buyers move away from larger sedans and trucks. [14] Fellow motoring giant Ford reported a 27pc fall in truck sales for June, with 59pc of sales now secured by cars and cross-over vehicles.[12] Evaluate features to find the best car for you. David Patton and Mathew Passy discuss yet another gloomy monthly auto sales report and whether Detroit can turn things around before they run out of money.[6]
This mean-lookin' machine may wind up in your rear-view mirror someday, as GM is thinking hard about bringing this 40mpg car to America.'' [16] The VEBA is a trust being funded by GM that will be managed by the United Auto Workers to cover retiree health care. While GM inevitably needs to adapt its model range to shifting demand, the adjustment is a painful one.[9]
The vehicle would need to be built to meet U.S. safety standards. "It depends what happens with fuel," Nerad said. "Everybody is trying to figure out if this is a fuel spike, or if these prices are here to stay. [5]
SOURCES
1. Bloomberg.com: Worldwide
2. General Motors may introduce the small Chevrolet Beat to the US market
3. 24/7 Wall St.: GM (GM) May Market Mini-Car In US
4. GM is marching to a new Beat - The Denver Post
5. US Auto Makers Mull US Launches Of Mini, Subcompact Cars
6. GM to Speed Decision on Mini Car for U.S. - WSJ.com
7. 680News - ALL NEWS RADIO.
8. GM considers marching Chevy Beat mini-car into U.S. market -- chicagotribune.com
9. GM may bring minicar to U.S.
10. GM may launch fuel miser in U.S.
11. Automotive World - US: GM'considering Chevrolet Beat minicar'for the US
12. General Motors swaps Hummers for mini-cars as fuel prices soar in the US - Telegraph
13. GM may sell 40-mpg Beat mini-car in U.S. -- Newsday.com
14. GM weighs minicar for North America - FP Posted
15. GM might launch Chevrolet Beat in US market
16. The Chevrolet Beat, America's New Mini-Car? : Gas 2.0
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