Holden in compact 4WD bid

HOLDEN is bidding to win the lead design and engineering role for the development of a new compact four-wheel drive General Motors could launch throughout the Asia-Pacific region around mid-decade.

The car would fill a gaping hole in Holden's local product line-up, as well as provide vital sales drive for GM in its aim to become one of the top players in the emerging Asia-Pacific market.

Holden is in competition with at least one other GM affiliate for the rights to develop the compact 4WD, probably the newly established GM-Daewoo Auto & Technology, which is the GM-controlled business that has emerged from the ashes of the bankrupt Daewoo Motor Company.

GM's Asia-Pacific chief Fritz Henderson is due to decide by the end of 2002 which Asia-Pacific affiliate will take the lead on this vital project.

He also has to consider how bespoke the vehicle will be, whether it will simply be an adaptation of US technologies or, at the other extreme, something unique to the region.

"There's a bunch of people working on just that problem," Mr Henderson said this week during a visit to Australia.

"If you look at that sweet spot SUV segment, it's one of the biggest growing segments here and a huge and growing segment in Korea, in which we don't play, so we need to fill that segment.

"We think we need a solution from Asia.

"Hyundai did it with the Santa Fe and did spectacularly with it, we don't have anything today. I think about our portfolio in Asia and it is probably our biggest hole." Holden has already pursued numerous possible scenarios to find itself a light-duty compact 4WD competitor to take on the likes of the Honda CR-V and Toyota RAV4:

• Rebadging the Subaru Forester. A tactic fought tooth and nail and eventually defeated by Subaru Australia.
  
  
• Exploiting the support of GM product boss Bob Lutz to source US-built product. Conversion from left-hand drive and currency exchange rates make that an expensive option.
  
  
• Stretching the Cruze platform. Thought to be a weak argument in terms of engineering integrity.

Holden boss Peter Hanenberger has previously talked of the company developing its own entrant based on the short wheelbase V-car platform and the 4WD technology from the forthcoming Cross8.

While that car would be too big for the likes of South Korea and Thailand, the technology developed for Holden's 4WD project could be the company's ace in winning the development race for the new compact entrant.

"It's all very early days but I believe we are now a strong centre of expertise for high torque four-wheel drive units like V6s and V8s," said Mr Hanenberger.

"And once you get that it's much more easy for an engineer to downgrade a system than to further upgrade it, so I think we will have some involvement.

"We will be in a bidding mode with somebody else - but you can see from my smile already that we are going to win this and then most probably have to do some engineering and design work along this line." Of course, Holden already has the styling kudos for the compact job, from the development of the Suzuki Ignis-based Cruze, which GM Asia-Pacific sells in Japan as a Chevrolet.

But one job it will not get is building the compact. Holden's Elizabeth plant has its hands full with its current and future domestic and export rear and four-wheel drive projects.