GM may sell medium-duty truck unit to Navistar
In a move billed as potentially assisting Navistar with "life after Ford," the company is talking to GM about buying the General's medium-duty truck unit. Navistar already makes trucks and engines, and talks are only just beginning, but buying the GM unit would allow it to enlarge its market share and remove a competitor. Navistar, if you'll remember, is locked in a legal tussle with Ford to the tune of $2 billion. Navistar says that Ford is looking at introducing its own engines before 2012, in breach of contract; Ford says it's paying far too much for Navistar's 6-liter PowerStroke Super Duty engine issues.
Were GM to sell its medium-duty truck unit, assuming the price were right, GM would shed a non-core division, make a profit, and be able to focus on making cars. GM's medium-duty trucks are sold as the Chevy Kodiak, GM Topkick (aka "Ironhide"), and Isuzu T-Series, which together account for almost 12% of the medium-duty truck market. And apparently the medium-duties aren't the only ones on the block: GM is in talks to let Allison Transmissions go as well.
[Source: Automotive News, sub. req'd]
Related posts:
Navistar Slaps Ford with $2 Billion Lawsuit
Ford Developing New Diesel Engine, Quickly
Ford Supplier Stops Production of Super Duty's PowerStroke
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Reader Comments (Page 1 of 1)
Lithous 10:47AM (5/18/2007)
Wasn't the Allison Transmission unit largely responsible for GM's hybrid system for transit buses? Isn't Allison Transmission assembling the BAS and Two Mode hybrid systems for GM?
Selling Allison doesn't seem like a great idea right now. Maybe GM sees all electric vehicles without transmissions in the very near future (doubt it is that near) or they are making a mistake IMO.
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Uncle Bob 12:06PM (5/18/2007)
The truck pictured above does not look like it would be apropriate to transform into a ghetto cruiser.
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Made in USA 12:38PM (5/18/2007)
Here we go again. Hopefully this is just a rumor. I thought GM was going to stick to a core business of building cars and trucks? I guess we are honing this down to just cars and light trucks. GM sold its heavy truck operations to Volvo over a decade ago. Soon GM will pare itself down from light trucks to just cars. Then GM will go from building cars to building nothing at all. All so current execs can show a short term profit in the company... That is OK, at the current rate GM is progressing, there will be NO company. "We want to focus on core operations." - yea right.
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Brett Kelley 12:50PM (5/18/2007)
The scary thing is that I've seen a couple of those too-large-for-your-4-inch-ego trucks being used as Humvee-2 replacements here in the bay area. I saw one in Los Gatos, and the other in Campbell. As for the one I saw in Campbell, it was in a parking lot, and the guy who got out of it could not have been taller than 5'4" and had tiny hands -- clearly the target demographic for such a pointless vehicle for a civilian. I had to laugh--I tried to hold it in, but it just blurted out.
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Matt W. 12:54PM (5/18/2007)
Why link to a subscription only story when the Flint Journal, which broke the story, offers it for free to readers?
http://www.mlive.com/business/flintjournal/index.ssf?/base/business-1/1179157820274660.xml&coll=5
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Jellodyne 12:55PM (5/18/2007)
You don't suppose this has anything to do with raising GM's corpoate fuel economy numbers, do you?
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Richard 2:08PM (5/18/2007)
Made in USA wrote (No. 3) "... GM sold its heavy truck operations to Volvo over a decade ago. Soon GM will pare itself down from light trucks to just cars. Then GM will go from building cars to building nothing at all. All so current execs can show a short term profit in the company..."
Except for Mack, big trucks are interchangeable. Their only brand-specific parts are the steering gear and cab shell. Big trucks are all custom-made by assembling engines, transmissions, rear-axles, sleeper cabs, and even seats from numerous vendors. As such, their profit margin in minimal. GM lost nothing by selling its big truck operation to Volvo.
Uncle Bob wrote (No. 2) "The truck pictured above does not look like it would be apropriate to transform into a ghetto cruiser."
Very few of these pick-up trucks are sold in a market which is dominated by Navistar's XT line of Crisis-based pickup trucks. Most trucks in this weight class don't cruise the ghetto or the Sunset Strip. They are sold to fleets, which everyone now understands earn little to no profit.
The key to success in today's market is to do one thing well and to concentrate on that one thing. Navistar International is dominant in medium and large trucks. GM's forte is cars and light trucks. That GM appears to be divesting everything but its core competencies is a very good thing.
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Matt W. 2:12PM (5/18/2007)
Jellodyne, I believe trucks aren't included in CAFE standards, so the disposal of the medium-duty truck business wouldn't help. If you read the Flint Journal story, it is clear that GM is considering a sale of its Kodiak and TopKick line of vehicles to clear space at the plant for additional heavy-duty pickup production. Plus, GM could make some cash from a sale to Navistar International.
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Mr.Fab 2:35PM (5/18/2007)
FINALLY! Though it likely won't play out this way, here is a chance to revive THE manliest MUY macho-est US vehicle marque EVAH! . . . wait for it . . . International Harvester!! IH, BayBEE!! Now where do I put down my '11 Scout deposit HUH?!?!? Happy Motoring!
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Jay 5:29PM (5/18/2007)
If GM sells Allison trans, I will personally find Rick Wagoner and bitch-slap him
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Guenther 6:51PM (5/18/2007)
Good point. Navistar still owns the Scout brand. The problem selling the class 4-7 line to Navistar is that they already have trucks in that segment. I don't see much benefit to Navistar here- if someone does, please enlighten me. Its also attractive for GM to have a line of Medium duty trucks in the lot, because Ford does. If I'm a medium size customer, running a few plow trucks, some dumps, and maybe a tandem, its nice to be able to go to one dealer. Also, gearing up to build MORE HD pickups just sounds a little optimistic at this point.
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Barney 7:00PM (5/18/2007)
Navistar already makes a medium duty range of trucks. Daimler had bought Fords medium duty truck line and now calls it Sterlin. Ford is still making a F550/650 which is pushing the edge. Navistar also makes a Cab-Forward using the v6 diesel that Ford ordered then canceled for their F150. GM may do as Ford and introduce an extra heavy duty.
Allison is a separate division and not part of the GM medium duty truck line.
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Bob 7:01PM (5/18/2007)
this pick-up on the picture really must be destroy
http://clubvaio.blogspot.com/
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Barney 7:03PM (5/18/2007)
"Except for Mack, big trucks are interchangeable."
Class seven & eight are as you describe but under those GVWs, the choices are limited. Drive train options are even becoming less of an option.
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Catskinner 11:58PM (5/18/2007)
I don't see the loss - GM hasn't put out a decent ½ ton pickup in years, much less a 2½ tonner.
It used to be that Kodiaks and Topkicks were the most commonly sighted medium dutys out there, now they are virtually non-existent.
GM has slit their own throats with their inability to leave well enough alone.
The Duramax is an outright joke in the face of the Cats and Detroits that were the mainstay of GM medium dutys for so long, and the consumers know it. Where my company bought Topkicks for years, F650's with C7's now rule the roost.
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leftt2 6:23AM (7/20/2007)
you really should do your homework before you talk.. the C6500 through to the C8500 can be had with a Cat or an inline 7.8 litre isuzu 6 cylinder, as for the F650...????
Don 7:18PM (5/19/2007)
What's amusing is that Ford F-650 and F-750 Medium Duty trucks are now assembled by Navistar in Mexico in a Joint Venture (Blue Diamond). SO you could have Ford, GM, and IH trucks rolling off the same line.
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adam === 11:03PM (5/21/2007)
I work at Allison in Indianapolis. Allison builds automatic transmissions for commercial duty trucks. they are in your local buses, ambulance, garbage truck, RV etc. They are sold to (commercial) truck manufacturers world wide--not just put in GM trucks at all. Allison makes more net profit for GM than any other division. naturaly, these dopes want to sell it off for some quick bucks to help bail out the $ they lose making cars.
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