- Jul 21, 2008
GM's Plan: Small cars making a big profit
The plan is simple: make better small cars, charge more for them. The upcoming Cruze could run you a few thousand more than the outgoing Cobalt, for instance. The test is to see whether cars like the Cruze will be worth the premium. GM Global Design Chief Ed Welburn said, "In North America, we never did a good small car." The General plans to bury that piece of its history... but it's going to charge you, the consumer, for the funeral.
The idea that GM can lasso the small car market while charging a premium, at the same time as slashes its marketing budget by $1.5 billion, takes some effort to swallow. One analyst said that demand for small cars will outstrip supply, so GM could get away with it. However, until we see proof of small GM cars that take bats to the established competition, we'll have to give this plan a "Hmmm."
[Source: Automotive News, subs. req'd]