Chevy Cruze: Will Americans Buy "Small+Premium+Fuel-Efficient?"

Last Updated Aug 22, 2008 12:33 PM EDT

chevy_cruzeThe Chevrolet Cruze is a Euro-styled model that represents a big bet by GM that the tastes and spending habits of American customers will start to more closely resemble those of Europe, where people are willing to spend a premium price for a small car that's richly appointed, handles well and saves gas.

That sure would be convenient for GM, and also for Ford, which is pursuing the same strategy.

The trouble is, Americans traditionally associate small with inexpensive. "Small plus expensive" does not compute. In almost 20 years, GM has utterly failed to break Saab out of its microscopic niche in the United States, even with huge incentives behind it.

The Detroit automakers are now hoping that with today's U.S. gas prices, "small plus expensive, plus fuel-efficient" will do the trick. A new global product-sharing strategy is also aimed at toning down the "expensive" part of the equation.

The Cruze is also GM's latest in a series of "sneak peeks" at future product, like the recent announcement for the 2010 Cadillac SRX. As I've noted here before, us auto writers like a sneak peek as much as anyone, probably more, but we've also learned to associate such open-handedness with future product with a company that's on the ropes.

It's not a bad PR strategy, provided those future products are attractive. Based on photos, the Cruze certainly is attractive. You don't have to squint too hard to see the European styling, with an oversized front grille; tight lines and seams, and flush glass like GM corporate cousins Saab and Opel.

GM announced on Aug. 21 Chevrolet will unveil the Cruze at the Paris auto show in October. It will go on sale in Europe in March. More detail is yet to come, for instance which GM divisions get which version of the Cruze when, and in which markets.

Out of sheer economic necessity, GM and Ford are stepping up their decades-long effort to integrate their global product platforms. The idea, which is easier said than done, is to share development costs and parts under the skin, while providing enough distinctiveness in exterior styling, interior appointments, price, and ride and handling, to satisfy customers in different markets and different brands.

The mid-sized Chevrolet Malibu, introduced last fall, is the first of the current generation of product-sharing strategy at GM. It shares its underlying architecture with the Opel Vectra and the Saab 9-3, and likely additional variants that haven't been announced yet. So far, the Malibu is a roaring success in the U.S. market, with 2008 sales up 52 percent through the end of July, to 104,047, according to AutoData.

A more important test is whether this strategy works with smaller cars like the Cruze.
  • Jim Henry

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