General Motors Co. is studying several possible additions to its vehicle lineup, including a new midsize pickup and a stretched version of its European minivan, said three people familiar with the process.
Chief Executive Officer Ed Whitacre has told his staff to explore adding a few models to its future portfolio. He wants GM’s product staff to consider small, youth-oriented cars for Chevrolet and a large prestige sedan for Cadillac, as well as the minivan and midsize pickup, said two of the people, who asked not to be identified disclosing private discussions. The ideas are under study and may not be built, the people said.
Whitacre’s push to fill holes in the lineup shows how much GM has changed since last year’s bankruptcy. Now managed by industry outsiders preparing for an initial stock offering and freed of historic cost constraints, the new company is able to consider vehicles the Detroit-based carmaker once shunned.
“New management can look at things from a different angle,” said Rebecca Lindland, analyst with IHS Automotive, a research firm in Lexington, Massachusetts. “There’s a lot of market share up for grabs. It makes sense to look at some of these products.”
In June, Whitacre named Stephen Carlisle vice president of global product planning, reporting directly to the chairman. Since then, Whitacre has been asking his management team to explore new product ideas to see if the company can find new market segments and boost sales in the long run, the people said.
A GM spokesman, Pat Morrissey, declined to comment.
The company phased out its last minivan, the Chevrolet Uplander, in 2008, after concluding that consumers are more interested in SUVs. So far this year consumers have purchased 266,000 minivans, with Chrysler Group LLC, Toyota Motor Corp. and Honda Motor Co. dominating the business.
GM isn’t looking at a traditional North American-style minivan, said two of the people. The company is studying whether it can increase the size of its Opel Zafira van sold in Europe, the people said. That model is built on the platform of GM’s Chevrolet Cruze compact car.
“The minivan they are looking at doing would be a rethink,” said Jim Hall, principal of 2953 Analytics Inc., a consulting firm in Birmingham, Michigan.
GM has done less work on a new minivan than the other ideas the company is considering, two people familiar with the matter said.
GM is also looking at a new midsize pickup entry. The company sells the Chevrolet Colorado and GMC Canyon now, which are scheduled to be phased out in 2012. GM is looking at making a new model based on a pickup the company sells in emerging markets, one of the people said.
The small and midsize pickup market is a tough business in the U.S. right now. Sales fell 5.6 percent in the first seven months of the year, while total vehicle deliveries rose 14.8 percent, according to researcher Autodata Corp., based in Woodcliff Lake, New Jersey. GM, second only to Ford Motor Co. in large pickup sales, has 12.5 percent of the small pickup market, which Toyota dominates with 42 percent share this year.
One challenge is making a pickup that is cheap enough to lure buyers, Hall said. The Colorado starts at $16,765, or $580 cheaper than the full-size Silverado pickup. Many buyers opt for the larger truck because the prices are so close, Hall said.
GM is also exploring more youth-oriented cars for Chevrolet, a new compact SUV for the brand and a large, stylish sedan to compete with the Ford Taurus, said one of the people.
To target young buyers, GM is preparing to introduce the Chevrolet Aveo and Spark subcompacts. The GMC Granite, a boxy, small SUV that would compete with Toyota’s Scion xB, is also close to approval, the person said.
The company has also started work on a flagship sedan for Cadillac, two of the people said. Designers are looking at several prototypes that differ from the XTS concept car on display at the Detroit auto show in January, they said. If GM’s board approves funding for the luxury car, intended to compete with BMW AG’s 7 Series, it wouldn’t be built for several years, they said.
Some of the studies are being done to make sure GM can meet federal fuel economy rules that get tougher in 2016. By then, regulations mandate that each carmaker average 34.1 mpg across its fleet, up from 27.6 mpg for 2011.
GM is looking at a minivan and a pickup in case higher fuel prices necessitate something smaller than SUVs for large families or something more efficient than today’s large work trucks.
The company is also looking at a diesel engine for passenger cars in the U.S., said two people familiar with that plan. GM sells a diesel only in its large pickups.
GM no longer has financial constraints to keep the company from investing in new models. The capital expenditures budget is $6 billion a year, compared with $4.5 billion for Ford. Whitacre may invest more money for the right products and the company may need to hire more engineers and designers to develop the models, the three people said.
“Money isn’t the problem,” Hall said. “They don’t have enough people to do the work. It makes sense to look at these products. They could find the product they need this way.”