All Cars, All the Time

GM’s USA Small Car Fortunes About to Turn…


…a profit! Not impressed? Consider that Ford loses an estimated $4,000 to $5,000 on each Focus it sells. Before the General enacted some of its recent cost cuts, GM’s fixed cost overhead on each car manufactured in the USA was $8,000. That kind of cost structure would make any low priced car unprofitable. However, the picture is changing for GM. Bob Lutz won’t say what fixed costs are down to, but he will say that the Cobalt is profitable. Now that Chrysler has its robots doing to the cha-cha-cha 24x7 at it’s Caliber assembly plant, it would seem that Ford is the odd man out when it comes to small car good news. Since Mark Fields has pulled back plans to introduce a small car until Ford can get it right, don’t look for much in the way of super duper news from the Blue Oval in this department. There will be a refreshed Focus, but it’s still the hand me down C170 version and not the Euro C1 platform.

sources: wsj, business week