GM is looking for other ways to fine-tune its business.
General Motors' recent decision to sell its Opel and Vauxhall brands might be just the start of a new paring initiative, a new report finds.
Although we're not likely to see another shakeup on the magnitude of leaving a mature market like Europe from GM anytime soon, the automaker says it's still weighing smaller cuts where it makes sense. "There's a little bit more work that we're doing in the international markets," GM CEO Mary Barra told Automotive News. "Our overall philosophy is that every country, every market segment has to earn its cost of capital."
GM hasn't laid its future plans out in detail, but the company says it will reduce spending in some "select" global markets. The Detroit-based automaker has already reduced its capital outlay in Russia, Australia, Indonesia and Thailand, so further cuts in those countries could be looming.
The shakeup will also be felt in GM's home market of North America, where trucks and SUVs are rapidly displacing passenger cars. Just four years ago passenger cars represented 38.3 percent of GM's North American business; through the first two months of 2017 that figure has dropped to 25.3 percent.
GM hasn't announced any specific nameplates that could be targeted for a phase-out, but offerings at both ends of the spectrum are at risk. At the smaller end, the slow-selling Chevrolet Sonic could be in GM's cross-hairs. So far this year Sonic sales have plummeted by 47 percent. The Sonic's big brother, the Chevy Impala, could also be on the chopping block, with the sedan's sales off by 31 percent in 2017.
The Buick LaCrosse, a cousin to the Impala, could also be in danger. Despite being redesigned last year, GM currently has a 340-day supply of the full-size sedan. In comparison, the automaker's full-size SUVs are running under a 60-day supply. GM has already axed the smaller Verano sedan from the Buick lineup due to slumping sales.
GM will use the savings realized by the cuts to invest more into trucks and SUVs, as well as the company's Cadillac luxury division. Some of the money will also be used to help fund GM's development of autonomous technologies.