GM delays all development spending through 2010
A story from the Crain sisters, Automotive News and Autoweek, reports that General Motors has cut product development spending for 2009 in an effort to save approximately $1.5 billion next year. Reductions in engineering, design and R&D work on future models has been rumored for the last week, possibly causing the delay (or death) of a few select models. However, the Camaro and Volt haven't been affected by the cuts (no surprise, since they're all but complete), and the new Buick LaCrosse, Chevrolet Traverse and Cadillac CTS Wagon should hit the market has planned, late next year and early in 2010.After the story surfaced earlier today, the Detroit News got in on the action and spoke with GM spokesman Tom Wilkinson who said of the AN report, "We think they are probably overplaying this a little bit." We'll see.
[Sources: Autoweek, Detroit News]
Reader Comments (Page 1 of 1)
Jj 6:08PM (10/29/2008)
GM just can't buy a break. They finally have some good products in the pipeline that might have finally turned things around and the economy falls out from underneath them.
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zamafir 6:46PM (10/29/2008)
ditto, i thought a big part of their turn around was finally bring to market competitive products. stifling the R&D that resulted in the new Malibu et-al isn't going to help them in the long run. It's sad to see them finally look past 2-3 years, as any company should, only to be brought back to that backward thinking by the state of the economy and their previous blunders.
Ligor 10:22PM (10/29/2008)
i hope this doesn't mean skimp on the upfront engineering and fix things with a recall later
i think they should have just pushed thru this and instead of delaying the progrmas they should have speed them up
good product is still thir hope of turnaround, and if engineering is gone I am sure recalls are likely to climb and then GM recent strive in quality will take another hit, possibly one that'll shrink their market share
come on GM, don't skimp now
Greg 6:14PM (10/29/2008)
Isn't the Traverse already on dealership lots?
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bh 7:02PM (10/29/2008)
They probably mean Equinox.
Taylor 6:52PM (10/29/2008)
Yeah, i am still bummed that the Kappa (Saturn Sky and Pontiac Solstice) platform isn't getting a refresh (in the form of the Kappa II platform). They made a fastback pontiac, but there are still lots of issues with the platform (no trunk, weird layout in the interior, no storage anywhere, etc). The fasback may have a nice trunk, but that doesn't help the convertible at all. It's too bad too, it's a nice platform (i have a Sky), it just needs some improvements. I hope GM starts to do better and brings back a refresh. Besides, those Mallett LS7 V8 conversions are badass, GM needs to offer that as an option from the get-go!
-Taylor
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MoonRover 7:03PM (10/29/2008)
My Mother always said, "Don't believe anything you hear and only half of what you see". I believe that would apply nicely here, the media has gone berserk in an attempt to run GM into the ground, what a shame.
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FallenCow 7:25PM (10/29/2008)
Way to invest in your future GM... how about cutting executive salaries first!
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jv2k 10:47PM (10/29/2008)
You do realize a good chunk of their salaries comes from stocks right?
FallenCow 1:56AM (10/30/2008)
Well you do realize that those stock compensation is meant to motivate top executives... and yet you see how GM has performed... need i say more? or do you want a golden parachute too?
iQuack 7:38PM (10/29/2008)
GM has too many brands and should drop Pontiac, Saturn, Saab, and GMC (or Chevy trucks because they're redundant).
Would be best to sell Humme--if anyone is willing to buy it--and concentrate on Chevy and Cadillac in the U.S., and Opel in Europe.
It's surprising how weak Saturn is because its line-up of cars is excellent. Too bad Saturn is a failure because few buyers consider visiting its shrinking number of dealers. The Aura is one of the best looking sedans out there IMO, and it's a good car, too.
Buick is strong in China, so it should continue......even if eventually dropped in the U.S.
Hard to imagine GM's fall.........I remember the '50s and '60s when GM cars were Kings of the Road.
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Noah 8:20PM (10/29/2008)
Yeah, I don't think I'm gonna buy this one, AB.
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info2x 8:50PM (10/29/2008)
I'm with you Noah.
I see them scaling back certain areas, but all areas of development seems a bit much. Especially if that only makes 1.5 billion saved.
Judy Zik 10:21PM (10/29/2008)
No kidding. Are we supposed to believe that GM's entire R&D department is just going to sit on their hands and collect a salary for nothing for a whole year? Even more unlikely perhaps we are supposed to believe that they are just going to lay the whole department off for a year without pay. This would be corporate suicide. All their best and brightest would leave and the damage it would do to their product development would be a death blow.
Jj 10:35PM (10/29/2008)
I just read the original Detroit News article and I don't see where it says that this is a complete R&D shut down. It says a cut of 1.5 Billion, witch can't be anywhere near the entire R&D budget.
Nightcrawler 3:04PM (10/30/2008)
The headline of this item is misleading. When I saw "GM delays all development spending through 2010", I thought that meant there would be no development spending until then. But that's not really what the text says.
They should have cut the world "all" out of the headline. I now realize what they were trying to say, that all areas of development would have spending reductions, but the headline make one think there will be no development spending whatsoever.
Tom 1:40AM (10/30/2008)
oh my god, they figured it out. Save the board of directors + get rid of those pesky new/better products = PROFIT!
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tanooki2003 8:34AM (10/30/2008)
Another stupid boneheaded GM move, but it doesn't surprise me.
This is where GM really should spend most of it's money instead of cutting back in this department, especially if they want to get ahead and pull themselves out of a slump. They should cut back in other departments.
So with this news I guess we will expect nothing more but a bunch old 90's era Buick and Oldsmobile-ish looking vehicles that completely lack zest, style, fun, and appeal, or in other words the best we can hope for in their standard lineup (which means this does not include cars such as the Corvette in case if you were going to use that as a justification) is a bunch of import followers instead of being leaders. Then again I expected as much from GM being as how they have been in the 80's, 90's and the early millennium.
I guess GM really doesn't care to get ahead and regain their strong sales back from Toyota and other foreign companies. Maybe getting bailouts from the gov't might be GM's excuse for being totally lazy in being competitive now that they have the new Camaro, G8 and the existing Corvette plus gov't money to bail them if they back themselves in a financial corner from bad choices after bad choices.
That's ok there are several more better choices of companies to choose from. It's not like I work there and an obligated to support them in any way.
Best of luck GM. We will see if your sales will keep from falling any further.
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tekd 9:56AM (10/30/2008)
So....what's the plan for 2011 when their R&D is circa 2008? Of all the things to cut, cutting R&D is ridiculous.
Oh and...wasn't that taxpayer funded 25 billion loan to the big 3 supposed to be for R&D of more efficient cars?!? Are they taking our money then NOT spending it on R&D? WTF GM
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