GM ditches ‘US Commodore’

HOLDEN’S role in the worldwide General Motors rear-wheel drive program, code-named Zeta, has been thrown into disarray following a decision by the corporation not to proceed with the rear-drive architecture for cars to be sold in North America.

The engineering program for the American car divisions, which was to have been run out of Fishermens Bend, has been put on indefinite hold because GM has more pressing problems to solve – especially in the area of sports utility vehicles for the US domestic market.

With the corporation bleeding to the point where it is now predicting losses to the international investment community, with income said to be some 80 per cent less than expectations, GM has been forced to allocate its priorities and SUVs won the day.

A boost in sales of SUVs in the truck-focused US market is more likely to send more profit to the bottom line than a boost in sales for mid-range cars the size of the Commodore.

The cars were to be the next-generation Pontiac GTO and mid-sized rear-drive cars and crossovers for Chevrolet, Pontiac and Buick. A concept for the Buick Velite was shown at the recent New York Motor Show.

The decision by GM product chief Bob Lutz, a strong proponent of rear-drive cars for the US, was also said to be based upon doubt that GM could make money on the Zeta-based cars sold in America.

Holden management has been surprised by the move and is still attempting to find out what it all means.

But officials are emphatic all development of the Zeta architecture for the Holden VE Commodore, for both the Australian market and for Holden export markets, will not be affected by the change in direction.

While GM has said Holden will continue to be responsible for development of the Zeta program, Holden is saying chairman and managing director, Denny Mooney, will not be commenting until his group has learned just exactly what the impact of the announcement means to their total involvement in Zeta.

At this stage, Holden believes its role in global engineering and design for GM is unchanged and that Holden would continue to be a centre of expertise for GM in engineering and design for rear-drive cars.

But the establishment of a so-called “homeroom” in Melbourne to house the global design team is unlikely to go ahead. The man appointed to be the vehicle line executive in charge of the rear-drive platform project, Gene Stefanyshyn, is now unlikely to take up his post in Australia.

Holden’s acting national manager – media relations, Emily Perry, said: “We are still working through that to determine what his role will be and what the (future) requirements will be for Zeta.”

Under the planned homeroom, the Holden team was not just working on the Holden VE platform, but was performing the engineering for the various models to be put into production for each of the North American GM divisions. That work is now indefinitely on hold.

But the team was also working on versions for Europe and for Asia-Pacific and the future of those programs still has to be clarified.

“Our position is that this is not the end of the story,” Ms Perry said. “We are still working through it and it really is too early to make any definitive statements about what the future holds.” Given GM does not intend to proceed with any North American-based vehicles off the Zeta platform, there are those who see the decision as an opportunity, especially where the Pontiac GTO is concerned.

Under the Zeta plans for North America, Holden was getting the role of engineering the Pontiac GTO. But, unlike the current export arrangement, the GTO was going to be built in North America and not in Australia.

If the US decides it still wants a GTO, the possibility could exist that the Monaro could get another life on the Zeta platform and be exported to the States out of Elizabeth, South Australia, using Australian parts.

But volumes would remain limited because of the restrictions placed on the program by the United Auto Workers union in the US and production capacity at Elizabeth.

It may also be that the US divisions could cherry-pick other limited-volume offerings from the Commodore range to ginger-up GM’s mainstream brands.