For the record, GM isn't saying precisely how large GM10 actually will be when the final scheme unfolds. But the car lines it's scheduled to replace represented 37% of GM's total 5.4-million North American car production in 1985, attesting to the fact that the midsize market is GM country.
Mr. Reuss provides some perspective: "It's our biggest, so I guess it probably is the biggest (in industry history). It's a group of replacement products for the heart of our lineup--the intermediate-size vehicles. As a result, it's going to be a high-volume series. It isn't just one vehicle, it's a whole series of vehicles with a lot of unique and distinct personalities.'
Put another way, GM10 alone calls for more than twice the cash Ford Motor Co. spent ($3 billion) on its largest car program to bring Ford Taurus and Mercury Sable to market last December. Measured by annual production, GM10 is four times larger than Taurus/Sable's 500,000 yearly capacity.
Some industry observers say that GM is blinking after taking a fresh look at the competitive environment and is downsizing the program--speculation fueled by GM's January decision to take its Arlington, TX, assembly plant out of the GM10 running, reportedly because of worker resistance to work-rule changes. But Mr. Reuss says it simply is not true that the program has been downsized. Timing of some models may change, he allows, but GM10 remains as big as ever envisioned in the first place.
Insiders hint that GM's strategy may have changed to phase in GM10 at a slower pace for two solid reasons: With tweaking, its A-body cars may remain competitive longer than anticipated, giving GM vital breathing room to make certain its plants and processes can deliver high-quality GM10 cars necessary to do battle against the burgeoning competition. The Buick, Oldsmobile and Pontiac divisions each plan major A-car facelifts for '88 to carry them over until '90, when each gets GM10 sedans. And there's even talk that some A's could linger after that, alongside the slightly smaller W-cars.
But make no mistake: GM10 is an automotive gorilla among a band of chimpanzees.
"There's so much at stake in the program,' says University of Michigan auto expert David E. Cole. "I'm not sure it was conceived with the same environment in mind that may be materializing. What we're into is just a vicious competitive situation where the customer is driving the market. With the variety of offerings available, I'm not sure there is the volume potential there that GM thought. I think they've been scaling back some of their expectations.'
Dr. Cole continues: "Even though I think they have developed some ways to achieve a major degree of uniqueness among product offerings of various divisions, it may not be sufficient considering what's happening to the market. It's just coming apart at the seams.'
How important is GM10? "It's the most important car program that GM has probably ever had,' says Philip K. Fricke, Goldman & Sachs Co. auto analyst. "I think GM has to be damned careful on planning too much capacity. It is their bread and butter, but there's a lot of competition there, and I think there's too much supply and capacity in the business. That's always been true in smaller cars, but it's extended up into the midsize cars.
"One of the critical things GM has to do is determine what the capacity is going to be. I don't see the competition limited just to the Japanese. I think there's a lot of competition coming from Europe,' he says.
David Healy, vice president and auto analyst at Drexel, Burnham, Lambert Inc., says his sources tell him the GM program is undergoing substantial midcourse changes. "It carried a $7-billion price tag at one point, which was bigger than Saturn ($5 billion) and all that, but it has had a tendency to shrink lately,' he says. "I think they've been paring it back. It's more like $5 billion. I hear they got a look at (Ford's) Taurus/Sable and said, "S--, they've done our W-cars two years before us.'
"They're now cutting on the size of the program and redoing a lot of sheet metal at the last minute so it doesn't look exactly like the Taurus and Sable. They seem to be cutting back a bit,' he maintains.
Adds Goldman Sachs's Mr. Fricke: "It's a challenge to both the marketing and styling people. GM has blown it, not only in terms of marketing, but in terms of styling. It will probably be the most significant new car GM has come out with. But Ford's marketing of Taurus/Sable has been nothing less than brilliant. The consumer has been prepared for the (rounded, aerodynamic) look. They built up an anticipation for the car. It's one of the best marketing efforts I've seen in the business.'
While privately conceding Ford has done a skillful job of selling it's new aero styling look, GM executives take considerable umbrage at any suggestion that it has been significantly outdistanced by Ford on the product front. GM's line is that Ford merely is catching up with its popular A-cars and will be scrambling again when the GM10 cars start appearing early in 1988.
One top GM executive admits privately, however, that "you can always learn from the other guy' and that Ford pulled off "some clever things' in designing Taurus/Sable--ideas GM still has time to incorporate in some GM10 models.
Scheduled to be replaced by GM10 first are three rear-drive G-body sporty coupes: Buick Regal, Oldsmobile Cutlass Supreme and Pontiac Grand Prix, all in 1988. Chevrolet Motor Div. follows in 1989 with GM10 successors to A-body Celebrity as well as G-body Monte Carlo. In 1990, the other three participating divisions get GM10 sedans, replacing the Buick Century, Olds Cutlass Ciera and Pontiac 6000 series --all front-drive A-bodies. Station wagons may come in 1991 (GM's existing midsize wagons are on the A-body platform), but that decision has not been made. In fact, some A-cars may continue side-by-side with GM10 models for a time.
GM Vice President/Buick Motor Div. General Manager Donald E. Hackworth confirms that Buick will have a GM10 coupe for the '88 run while retaining its Century A-car--albeit with an extensive restyling (new front and rear treatments plus interior changes, all exclusive to Buick).
At Oldsmobile Div., GM Vice President /Olds General Manager William W. Lane verifies that he'll also get a new GM10 sporty coupe in '88 to replace the bigvolume (190,000 units in 1985) Olds Cutlass Supreme coupe. Olds' A-body Ciera will remain at least until 1990.
Mr. Lane, for one, expresses no fear about rising competition in Olds' strongest market segment. "If there's more competition --and if you give buyers more choices --then if you do a better job, the better your chances are. I'm not worried about more choices; it gives you a better opportunity to sell.'
Chevrolet expects to get up to 400,000 GM10 models annually, weighted 60% toward sedans, says Donald T. Sullivan, manager-planning. He confirms that Chevy, for one, will drop its A-car when GM10 arrives in '89, but the Celebrity nameplate will be retained.
David A. Hansen, Pontiac Motor Div. director-product planning, says Pontiac's decision on carrying over the 6000 after GM10 sedans begin arriving hinges upon whether its A-car still is popular and upon GM10 capacity. But, he adds, the 6000 will contain numerous improvements such as optional antiskid braking. "There's enough difference between them (6000 and GM10) that we might run them both for awhile,' he says.
While public knowledge of the GM10 marketing strategy remains a tad nebulous, even fewer concrete details are known about the products themselves.
Mr. Reuss contends the GM10 cars will be dramatically different from current products and that journals such as WAW should be cautious about arriving at too many conclusions from spy photos or drawings of prototypes.
What WAW has determined from scores of interviews is that GM10 will slot in the 3,000-lb. (1,350-kg) class, about the same as the A-cars but several hundred pounds less than the G-coupes. They'll be slightly smaller in major dimensions than the A's and will feature extensive electronics and 1-piece, molded-foam seats.
Although styling of all GM10s will be aero, the entire concept is based on allowing divisions to use the platform to produce distinctive cars, an issue that is particularly sensitive at GM these days.
"That's an important part of GM10,' concedes Mr. Reuss. "We will have more uniqueness division-to-division than we've had on any product in the past. People will immediately realize this is different. It has the look of a much more futuristic project. One of the things the organization is working on is trying to get more market segmentation between the various divisions so that the old business of dropping the gauntlet and saying everybody gets everything coming out of the chute are gone.'
One area where GM divisions will try to make a distinctive mark, beyond styling, is engine options. The list gives everyone a chance to dance to his own music: Chevrolet apparently will offer at least two choices, an advanced 2.8L V-6 with aluminum heads and manifolds and yet another updated version of GM's 2.5L 4-cyl. workhorse. Oldsmobile hopes to have its new 2.3L Quad 4--a 150-hp 16-value 4-banger--as an exclusive for the '88 GM10 coupe (it's already earmarked for N-body Calais compacts that year) and for '89 plans 185-hp and 250-hp Quad 4 spinoffs, the latter turbocharged, Olds Chief Engineer Theodore N. Louckes tells WAW.
As new as the cars, say GM executives, is the way the project is being put together.
"The product itself may be less significant than the way we're going about it,' says Gary W. Dickinson, a GM vice president and CPC group director-engineering. Mr. Dickinson was the first GM10 program manager.
"It's a brand-new program-management approach that was initiated with the GM10 program. It's really a business approach to managing the introduction of a new-car program. It's not a project center (traditionally centered around engineers). This is a management center where all the functions are represented. All the disciplines. Everybody is located in the same building --product engineering, process engineering, the assembly folks are represented, the financial people, the quality assurance group, purchasing, marketing,' he says.
David D. Campbell, also a GM vice president and CPC group director-operations as well as a member of the board of New United Motor Manufacturing Inc. (the GM/Toyota Motor Corp. venture), admits some Japanese management-style influence may have crept into GM10 by osmosis.
"What you were dealing with in the past at General Motors was an elephant,' he explains. "You've got big organizations --Chevrolet, Pontiac, engineering, finance. So what you do with a PDT (product-development team) is take a piece out of all of them and put them together in a little group. You give them the authority and the responsibility to make a good decision.
"In the past, we'd have big groups of product engineers, big groups of process engineers, and a group of financial people and so forth. Now we have them in small groups and they can do the job just once. They're all there at the beginning. It's a way of smalling-down the organization.'
Little publicized to date is the fact that GM10 will mark the death of the traditional assembly line at GM. There will be no traditional conveyor made legendary by Henry Ford. In its place will be automatic guided vehicles (AGVs), supplied by Sweden's AB Volvo, that follow wire paths embedded in the floor.
"The process for GM10 will be so new it will startle you,' says Mr. Campbell. "Plants like Orion (MI), Wentzville (MO), and Detroit/Hamtramck will become dated now. What we've learned there, we've now applied to GM10. The beauty is all of the operations now can become nonsynchronous. If you have a car that's heavily loaded with options, it can stay at a station for however long you decide you want it at that station. Other cars can go right around it.
"Those lightly loaded cars that don't take a lot of things like air conditioning and Bose radio systems just bypass that station. Every operation can be tuned to the worker so that (he or she) can spend more time on those operations that require more time. The worker can become more involved in the assembly process. It's really a radical approach to the assembly process. It gets rid of Henry Ford's conveyor chain for the first time,' he explains. |
