GM’s Euro Makeover

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Saturn Astra

If you'd like to get a look at the future - at General Motor's future, anyway - stop into your nearest Saturn showroom.

There you'll see several models that were developed in a close cooperation between GM's U.S. brand and its flagship European subsidiary, Opel. While the recently updated Vue shows significant changes made for American buyers, the compact Saturn Astra is, for all intents and purposes, the same car you'll see roaming the streets of Paris and blasting down the Autobahn in Germany.

What's under way is "a pretty radical shift," says the General's vice chairman and "car czar," Bob Lutz. Going forward, he adds, we American motorists are going to see a "more European lineup than ever before in our history."

There are several reasons why this is happening, and the makeover will show up in several different ways.

The why is simple. For several years, to give him credit, Lutz has warned that if gas hit $4 a gallon, we'd see consumers radically shift their buying patterns. And as his colleague, GM president Fritz Henderson, said on Tuesday, the changes we're seeing now are very likely permanent.

If you thought the build-up of the light truck market, starting in the late 1980s, was fast, you ain't seen nuthin'. Full-size pickup and SUV sales have absolutely collapsed. Dealers in much of the country are just about giving those vehicles away. (Great news, as a friend of mine declared, if you absolutely have to have one.) Suddenly, passenger cars - especially some of the smallest and most fuel-efficient - are hot, along with the latest generation of car-based crossovers.

Sure, if fuel prices go back down - indeed, even if they stabilize, and consumers get used to paying four bucks - trucks will bounce back, but as Henderson said, the recovery will be nowhere near what we saw as recently as 2006, when light trucks grabbed half the market.

Since American motorists traditionally bought trucks and larger cars, it was much harder for GM, and its domestic brethren, to consolidate global product development. Now, however, it makes a lot of sense. And if you can design an Astra for the U.S. and Europe in one fell swoop, you've saved yourself anywhere up to $1 billion in product development costs.

Now, don't assume what you'll see at a Chevy showroom, never mind Saturn, Buick, or Pontiac, will always be the same here as over there in Europe. Even if high gas prices force Americans to downsize, our tastes are different. We're less into station wagons and hatchbacks. But GM is getting a lot better at coming up with a few sheetmetal variations that otherwise share the same components under the skin.

Another difference: Europeans don't traditionally link size and price. So instead of buying a $30,000 SUV, they'll pay that for a smaller, but functional crossover or wagon. Indeed, in Switzerland, the average transaction price for a new automobile is a whopping $42,000.

So you may see a Chevy sharing much of its basics with an Opel, but the American version might lack a lot of what in Europe is basic, standard equipment.

GM Scores Big in Europe

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Opel products 7-08

Take good news where you can get it.

There have been pretty slim pickings for GM to crow about in recent months in the home market, but for a modest upturn in retail passenger car sales driven by give-away incentives.

But while the U.S. market is in near-freefall, things look decidedly better in Europe, where GM is just solidifying a long-anticipated turnaround with an array of new products.

The automaker has stabilized market share for the first six months of the year at 9.5 percent, according to preliminary registration data. First-half sales, however, increased by nearly 3 percent, to 1.16 million vehicles, compared to the first half of 2007.

Driving the growth? Several things. There's the increasing success of the Chevrolet brand - GM's North and South American flagship, it's a recent addition to Europe, where it targets the entry and economy buyer. Year-over-year, Chevy's European sales are up a whopping 28 percent.

Overall, GM sales in Eastern Europe rocketed 58 percent, while they soared 60 percent in Russia, where GM sees some huge growth opportunities.

There's no question that the automaker must turn things around in North America, particularly the United States. Until then, it will continue to burn cash faster than it can rebuild its bank account. But the ongoing improvements in Europe suggest that the automaker's goal of becoming a truly integrated global player is taking root, and with overseas markets now accounting for half of unit sales - with a goal of reaching 75 percent - the United States could play a steadily decreasing role in the future.

Malibu Plant Up and Running Again

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2008 Chevrolet MalibuThings are starting to look a lot better for General Motors – at least on the labor front. With the nearly three-month strike at American Axle, a major parts supplier, settled, GM is also getting workers back on the job at some of its own plants, several of which had been hit by strikes, in recent weeks.

After voting overwhelmingly in favor of a new, local contract, hourly employees started back on today’s morning shift at the plant in Kansas City that produces the automaker’s much-acclaimed Chevrolet Malibu sedan. Just days earlier, workers at another plant, in Lansing, Michigan, ended their short walkout – a deal apparently pushed through after GM announced it would eliminate medical coverage for strikers.

The giant carmaker was largely able to weather the American Axle strike because the supplier’s parts are mostly earmarked for large pickups and SUVs. Dealers were buried in supplies of those products, due to the shift in current market demand. But the Malibu is one of GM strongest passenger car models in recent years, and some dealers reported they had sold out of the sedan, which was named North American Car of the Year in January.

Among the highlights of the deal that gets Kansas City workers -- all members of the United Auto Workers Union -- back on the job:

• A $1,250 bonus to recognize their role in the successful launch of Malibu;
• Workers keep a $600 clothing allowance;
• And factory washrooms will now get hands-free flush toilets.

American Axle Settles, GM Malibu Plant, Too

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2008 Chevrolet MalibuThe nearly 12-week-long walkout at American Axle has ended and, with it, one of the most bitter labor confrontations to hit the U.S. auto industry in years. There's no word yet when all employees will be back on the job, nor how soon General Motors will be able to get enough parts to reopen dozens of plants shuttered because of shortages. The automaker did recently reopen five of 34 affected plants, however, signaling the likelihood of a settlement.

Meanwhile, workers at a GM assembly plant, in suburban Lansing, Michigan, have reached a settlement that should have them back on the job shortly. That's good news, as the line produces GM's popular Chevrolet Malibu sedan. The settlement, at the Delta Township plant, comes just days after the automaker announced it would cut off medical coverage and life insurance policies covering picketing hourly workers.