General Motors 2010 models include a muscle car (the Camaro), a hybrid pickup, several crossover vehicles and the battery-powered Volt
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The new Cadillac SRX, Chevrolet Equinox and GMC Terrain are replacements for older GM models that have failed to dislodge the competition in growing market segments. The SRX, for example, is aimed at a segment virtually invented by Lexus with vehicles such as the highly popular RX330. It offers a contemporary exterior design, a well-appointed interior and improved fuel economy that GM hopes will give buyers sitting on the fence ample reason to select it over a competitor. GM has also indicated that it is pricing the vehicle aggressively — that is, slightly under the competition — in an effort to win over more buyers.
The Chevrolet Equinox and GMC Terrain are aimed at the broad midmarket where motorists move among sedans, minivans and SUVs. The crossover segment, where vehicles are lighter and more fuel-efficient than traditional SUVs and not as dowdy as minivans, has grown in recent years, but the previous version of Equinox underperformed against Toyota's Highlander, Honda's Pilot and Mazda's CX9. The 2010 Equinox has a better, functional interior, more power and significantly better ride and handling than the old version, but it is an open question whether the improvements are enough to motivate motorists to trade in their Japanese or Korean models, which still dominate this segment.
Similar to the Equinox, the GMC Terrain is the first compact crossover vehicle from a brand that Obama's auto task force came very close to killing off. GM executives saved the nameplate by arguing that GMC-branded vehicles were highly profitable.
GM is also promising to deliver a new range of subcompact and compact cars starting next year, along with the battery-powered Chevrolet Volt. GM has five new small cars on the drawing board, including two versions of the Cruise that will replace the Chevrolet Cobalt next spring. In addition, Henderson has confirmed that GM is working on a new family of small cars that, following the intervention of the United Auto Workers, will be built in Michigan rather than China, where GM originally planned to make them. Henderson says the new small cars will be affordable and profitable.
The small-car segment, however, has been a black hole for GM's aspirations over the years, as the Corvair, Vega, Chevette and Cavalier served as mile markers on GM's road to bankruptcy. Thus, the new small cars will most likely receive a skeptical eye from car reviewers. That's one reason GM has retained 77-year-old Bob Lutz to extend his term as vice chairman indefinitely. A large part of Lutz's new job will be to charm some favorable reviews from a wary press.
"GM's essential issue moving forward is persuading a skeptical consumer base that its vehicles are worthy of consideration," says Jack Nerad, an analyst with Kelly Blue Book. "GM has lost at least a full generation of consumers, and it must not only solidify its base but gain new adherents," he says. Early indications are positive, says Nerad, but far from conclusive. "GM has demonstrated that it can do that with products like the Camaro," he says, "but it must do that with more than a few stand-out models."