Sunday, March 20, 2005
GM - Zeta RWD Platform Dead
General Motors confirmed Friday that it has stopped development on vehicles being designed for a new rear-wheel-drive platform in the North American market.
Sources said the move is not related to financial woes and the company's projected loss of $850 million for this year. They said the decision to stop developing cars on the platform, code-named Zeta, was made last year.
This was also confirmed to me personally this weekend by what I'd consider to be a reliable source.
Let me get this straight. Chrysler's car sales have been single-handedly turned around with the LX platform and especially the 300C varient. Ford is cleaning up with the Mustang (production has just been increased by 20%; the V8 GT models are nearly sold-out for the current model year). Currently, there are no hotter vehicles on the market from domestic OEMs. Go figure - we still like vehicles that are distinctively American.
One can make all sort of doom-and-gloom predictions about the future popularity of such vehicles if oil prices continue to creep up, but I offer two counterarguments. First, one no longer pays a significant penalty for power. The 300C Hemi carries an EPA Highway rating of 25 MPG, not much less than, say, an Accord, Impala, or Maxima. Second, the first vehicles to suffer from fuel cost increases will be large SUVs, and I wager that the drivers who migrate from those vehicles will find themselves at home in a large sedan or wagon that offers more performance, nearly as much usable room, and perhaps a 50-75% improvement in fuel economy, even if they don't end up in Prius territory.
GM, however, has apparently chosen not to play in this market, which is about the most disappointing decision that they could make. It'd be in their best interest to recall that the Japanese got their foothold in the US market not by making carbon copies of what was already available (big RWD vehicles), but rather cars that simply weren't offered (efficient FWD compacts). Perhaps Detroit's salvation could come from employing a roughly opposite technique - offer vehicles that aren't available anywhere else. It's odd to think that Detroit might be reduced to what could be viewed as a pursuit of niche markets, but, hey, they need to make something happen in the current environment, and it ain't getting done by battling the Asian manufacturers in the compact and midsize sedan market.