So Long Hummer - GM to Focus on Compact Cars
June 4, 2008
Amid an environment of sky-high oil prices that is causing the general public to drive less and shun the tradition big pick-up and SUVs they have come accustomed to, GM announced it is closing 4 manufacturing plants that build some of their biggest vehicles. This will help the company cut costs as they have seen sales of these beasts decline rapidly, and will surely help reduce their carbon footprint.
The big car market, long the mainstay of the Big Three automakers of Detroit, has come under fire recently as the costs to fill their gas tanks soar and people get more and more concerned with their carbon footprint. Switching from a Hummer, to, say, a Prius, has in instant impact on your carbon footprint and we are seeing increasing numbers of consumers make that choice.
After the oil shocks of 1979, similar trends took place in the automotive industry to deal with the high gas prices. But the difference today is that this is seen as a long term shift, not a short-term fad. GM CEO, Rick Wagoner, said “We don’t believe it’s a spike or a temporary shift. We believe it is, by and large, permanent.” That stands as a pretty clear prediction of things to come, coming from the head of the biggest car maker on the planet.
With the change in emphasis at GM, the company said they will be putting more emphasis on compact cars that use less fuel, and contribute less to your carbon footprint. GM is planning on introducing a new compact vehicle with a small 1.4 liter engine and push harder on existing small cars, such as the Chevrolet Aveo.
GM lost $3.25 billion in the first quarter of 2008 due to poor sales on their big cars, which for years have been the big money makers for the company.
|
Share This Story: |
