OK, not that fuel efficient

Eight weeks can do a lot of damage to a car's fuel economy.

General Motors Corp. today officially unveiled its newest car, the Chevy Cruze, which will be released in Europe next year and come to the U.S. most likely in 2010. The car, a small midsize (large compact?) sedan, is designed to be a fuel saver yet carry the kinds of options and upscale doodads that Americans normally see only on luxury cars and sport utility vehicles.

The car was announced (but not revealed) in mid-July and was described as a highly efficient sedan getting 45 miles per gallon on the highway. Today in Detroit, Ed Peper, general manager of Chevrolet, described the Cruze as a car capable of "close to 40 mpg." Although he said there were not yet official federal fuel-efficiency rating numbers, the at-least 5 mpg reduction in just two months might be disheartening for GM die-hards expecting a return to the glory days of fuel efficiency.

It also brought to mind the changing numbers associated with the Chevy Volt. GM execs have said the extended-range electric car, expected to be unveiled at GM's headquarters Tuesday, will have a 40-mile range on battery power alone. But last month, a GM official said the car might come in a version with a range of only 20 miles. Meanwhile, the price of the Volt, originally pegged at $30,000, has slowly crept up and now the company generally talks about a $40,000 price point.

For the record, GM's most efficient new car, the 2009 Chevy Cobalt XFE, gets 37 mpg on the highway and 30 mpg combined city/highway. The Toyota Yaris gets 36 mpg highway, but 32 combined, thanks to better city mileage performance. The Honda Civic hybrid and the Toyota Prius hybrid both get 45 mpg on the highway. The diesel-powered Volkswagen Polo, not available in the U.S., gets 61 mpg combined.

Peper said the Cruze would be sold in 100 countries. As seems all too typical these days (think European Ford Focus -- which is at least two years away from American shores) we get it last. Although Europeans will be able to buy it this spring in three different engine options (including a turbo-diesel), U.S. production doesn't begin until ...

April 2010. It will be built in Lordstown, Ohio, in the plant currently used to make Cobalts. Peper said that when production of the Cruze begins, production of the Cobalt stops. "The Cobalt will go away," Peper said, adding that the company is working on an as-yet unannounced small car that will fit somewhere between the subcompact Aveo and the Cruze in the Chevrolet lineup. The price hasn't been announced, but should be lower than that for the Malibu, Peper said.

GM has said it would spend a total of $500 million to produce the car here. At today's event, which was a preview for the Paris Auto show in October, GM also lifted the sheet off its new iteration of the Cadillac CTS: the CTS Sport Wagon. Yes, a Cadillac station wagon. "That name is kind of the kiss of death in marketing circles," GM design chief Ed Welburn said, when asked whether it would be called a wagon in the U.S. market. Like the Cruze, it's due out in Europe before the U.S. Like the Cruze, the rest of the world gets a diesel version. We, apparently, do not.

Aaron Bragman, analyst at Global Insight who was at the unveiling, said the Cruze was GM's attempt to increase profit margins on small cars. Despite their red-hot status among consumers, small cars are generally less lucrative than big trucks and SUVs. Cars such as the Cobalt are popular (so popular, in fact, that Peper said GM was starting a third shift at the Lordstown plant). But they have traditionally been in the "cheap and cheerful" mold with options (read: cash cows) kept to a minimum. In Europe, meanwhile, small cars often have leather seats, navigation systems, multi-zone climate control ... the works.

"The biggest challenge is: How do you make money off small cars," Bragman said. "This car is going to be significantly nicer than the one it's replacing." 

-- Ken Bensinger

Photo of the Chevy Cruze courtesy of General Motors

Comments

[Mark Hamachek]

Ha, ha! GM blows it again. Their fuel-economy's up, it's down, it's up again. I just don't see how they're going to pull this car off. It looks like...every other car on the road. And don't get me started on the Chevrolet Volt.

I hope GM figures it out real soon. Real soon.

[Phil Pollot]

For all the money the leadership of GM makes they can't listen to the customer, they should step down before there is no company left. They don't get it and soon GM will be nothing more than a memory. After a life time of buying their products we couldn't find a fuel efficient car we liked and left them for a Honda. The last GM car we had cost so much in repairs we can 't aford to buy and rebuild their cars.
The Volt is simply a marketing tool. How stupid to they think we are? They have yet to make a hybrid that even comes close to the Prius or Honda. Bye Bye GM.