GM eager to enter sports-car market

By David Kiley and James R. Healey
USA Today

General Motors plans to put three and probably four splashy auto-show cars into production, dropping the big automaker into the middle of hotly competitive niche markets that it has avoided.

For consumers, it should mean lower prices and better selections among affordable sports cars and distinctive retro-style vehicles. GM likely will bore into those segments with low prices, high performance and fresh looks — and deep pockets to support its entries with rebates, if necessary.

And for the auto industry it's a signal that the biggest kid on the block thinks it has figured out how to promptly, profitably develop and market low-volume vehicles that will draw new buyers and boost the automaker's image as well as its earnings.

GM has decided to produce, probably as 2006 models:

• Pontiac Solstice, a small, two-seat convertible sports car likely to compete against the Mazda Miata and Toyota MR2.
• A sports coupe based on the Saturn Curve, which was shown at last month's Detroit auto show.
• Chevrolet HHR, a retro-styled tall wagon meant to rival the Chrysler PT Cruiser. The name is an acronym for heritage high roof. GM sees it as evocative of the late 1940s Chevy Suburban utility vehicle.
• Chevy Nomad, which is close to getting the OK for either the 2006 or 2007 model year, according to GM executives. It's a small wagon with retro-styling cues and a name from the 1950s — a package that GM thinks could draw more buyers than the Mini Cooper does.

Solstice, Curve and Nomad all are based on a low-cost platform recently whipped up at GM and referred to as kappa architecture. It was designed to use lower-cost tooling and simpler manufacturing processes suitable for low-volume production. It's meant to allow profits on smaller volumes by keeping costs down.

Kappa also allows very different bodies and interiors to fit onto similar floor pans while using similar engines, transmissions and suspensions to further minimize costs.

If GM keeps its promise to price Solstice at about $20,000 — several thousand less than a typical Miata or MR2 — "I think it's going to do very well," says Tom Libby, analyst at the Power Information Network, an affiliate of consultant J. D. Power and Associates.

"This is one of the first vehicles that really reflects (GM product boss Robert) Lutz's management. He's very proud of bringing out vehicles not only that people like but that they can afford," Libby says.