North American Int’l Auto ShowDETROIT – General Motors Corp. advances its two hybrid-electric-powertrain systems strategy with the rollout of the affordable Saturn Vue Green Line for mainstream buyers, and plans to offer a more expensive full hybrid system on three fullsize SUVs.

The ’07 Green Line, with a mild hybrid system carrying a $2,000 premium, will start at less than $23,000 when it goes on sale this summer, GM announces at the North American International Auto Show here.

That is $4,000 less than the nearest competitor, says Saturn General Manager Jill Lajdziak.

The system shuts down the engine at idle, and restarts upon acceleration. It also provides electric power assist when additional performance is needed, and captures electrical energy through regenerative braking. The net result, Lajdziak says, is a 20% fuel economy improvement. (See related story: Saturn Hybrid May Prove Less is More )

This more affordable system could bring hybrid-electric vehicles (HEVs) more into the mainstream, says GM CEO Rick Wagoner. It essentially is a bolt-on system that can expand rapidly to more products.

’07 Saturn Vue Green Line

GM begins rollout of its 2-mode full-hybrid system, that allows vehicles to run on electric power, engine power, or any combination of the two, in mid-2007 with the ’08 Chevy Tahoe Hybrid. It will be followed by the GMC Yukon Hybrid.

Ward’s learns the hybrids will be assembled at the Arlington, TX, plant.

The auto maker now says it will offer a Cadillac Escalade Hybrid as well, in early 2008.

Bob Lutz, head of global design, says a hybrid system could be fitted into the Hummer H2 and H3, with some packaging issues, but there are no plans to do so.

“We might not be first to the hybrid game, but we’re in it now,” says Mark LaNeve, GM North America vice president-vehicle sales, service and marketing.

“We will cover every major vehicle segment with hybrid models,” LaNeve says.

The 2-mode system is being developed in partnership with DaimlerChrysler AG and BMW AG. It will improve fuel economy by 25%, GM says, when paired with its Active Fuel Management cylinder deactivation.

Wagoner says if the hybrid market becomes large, GM still is early into the game.

Toyota Motor Corp. leads the pack, and Ford Motor Co. recently committed to 250,000 HEVs by 2010.

Wagoner says GM does not provide HEV sales forecasts because the technology still is being tested. But comments made three years ago that GM eventually could sell 1 million HEVs annually remain valid if hybrids become mainstream, as GM will be a full player in such a scenario.

Chevy Tahoe Hybrid concept

Neither the mild, nor full hybrid system will be profitable initially, Wagoner says. With the need to amortize costs early in a new product’s lifecycle, he is convinced no auto maker can make a profitable HEV initially.

GM’s goal is for its HEVs to eventually become profitable. With vehicles such as the Saturn, that would come with volume. With the 2-mode system, it comes from the fact the more expensive system is on more-profitable vehicles.

Says Wagoner: “If you start with a more profitable vehicle, you have a better chance of making money.”

apriddle@primediabusiness.com