GM (NYSE: GM) has decided that it will come close to suspending development of new SUVs. The market for the trucks is so bad that even Toyota (NYSE: TM) thinks it will lose money on the beasts in the US this year.
The Wall Street Journal reports "General Motors Corp. is delaying the redesign of SUVs and full-size trucks as part of a wholesale review of its product." For those not watching the car business over the last year, GM's decision comes way too late.The company should have cut back SUV development some time ago and made an attempt to get more of the mid-sized sedan market controlled by the Japanese.
It is easy to say that GM could not have seen the future, but that would be slighting companies like Nissan and Honda (NYSE: HMC) which was early in marketing more fuel-efficient cars.
GM is paying dearly for its mistake. Its shares hit a multi-year low at $14.75 in trading yesterday. They have not been so low since the Arab Oil Embargo in 1974.
How ironic.
Douglas A. McIntyre is an editor at 247wallst.com.











Reader Comments (Page 1 of 1)
6-19-2008 @ 10:29AM
Victor said...
American cars are garbare and always have been, we are too lazy and overconfident to make anything that will last
6-19-2008 @ 10:50AM
jpdr1100 said...
What was not said was that Toyota just spent million$ to build an even larger Tundra pickup, and an entirely new plant to handle the expected sales (which never happened). Nissan had just invested in an over-sized pickup a few years earlier, and now will drop the whole line and instead buy pickups from Chrysler. Both companies then build equally thirsty SUVs off of those platforms.
Where is the criticism of their lack of foresight?
6-19-2008 @ 11:26AM
Paula said...
GM would do a brisk business if it opened a monster truck/SUV plant in the "live to drive or die" state of New Hampshire. You get the living clientele of what I would call "rural yuppies" . People in the state think there is oil under that state's granite bedrock. They also have the attitude if the price of gas goes up to lets say $15per gallon? So what? we will just get a bigger gas guzzeler. They love more highways while trashing any thought of modern highspeed rail systems. They go to the local school district meetings and vote for much higher property taxes, to wheen people out of town like elderly or fixed income people. But then they cry poor mouth if a state sales or income tax where initiated. Also state vehicle inspection is very strict. No rust. The state's vehicle inspection stations must be in cahoots with those new GM car dealers. That is why you don't see vehicles made out of ( or at least the undercarriage or sill part of the vehicle made of light weight stainless steel.) A vehicle made of Stainless steel is what I would call real professional grade No hazardous waste rustproof undercoating required.
GM, and for that matter all the other car companies except Delorean are keeping the public in a wastful consumption buying mode.
I have to say "sarcastically" what's good for GM is only good for New Hampshire .
People here in the state will probably end up getting mules to pull those oversized pickups or SUVs.