DETROIT – A top-rankingCorp. executive says it’s unlikely the auto maker will reach its hybrid-sales goal in 2009, given gasoline prices are under $2 a gallon, while also reporting a weak start to overall new-vehicle sales in 2009.
Ironically, Ed Peper, vice president and general manager-Chevrolet division, also announces at the Automotive News World Congress here a special edition of the Chevy Corvette sports car for the ’10 model year.
“It’s a driver’s edition, with some very cool decals and a fun vehicle to showcase Corvette technology,” he says. Details of the new Corvette are forthcoming, but Peper says it will be available in both convertible and Z06 coupe styles.
The variant’s arrival will help take the sting out of a decision to delay a seventh volume-model Corvette because of GM’s wobbly financial position, and to cut production at the marque’s plant in Bowling Green, KY, last year due to the flagging economy and record-low sales. Corvette deliveries fell 19.9% in 2008 to 26,971 units, according to Ward’s data.
Peper tells Ward’s on the sidelines here GM probably won’t reach its hybrid sales goal, which typically represents 7%-8% of retail sales. “It might be a stretch to do that,” he says. “Our forecast, being conservative, would be more in the 6%-7% range of our retail business.”
GM offers hybrid versions of the Chevy Malibu and Saturn Aura midsize cars; Saturn Vue small cross/utility vehicle; and Cadillac Escalade, Chevy Tahoe and GMC Yukon fullsize SUVs. It also launched late last year hybrid versions of its Chevy Silverado and GMC Sierra fullsize pickups.
The auto maker has delayed the launch of a new Saturn Vue hybrid from fourth-quarter 2008 to first-quarter 2009 due to financial troubles.
Excluding the Silverado and Sierra, GM sold 14,639 hybrid vehicles last year, according to Ward’s data. By comparison, thebrand sold more than 200,000 units of the Camry and Prius hybrid midsize cars.
“With gas at $2 a gallon, it brings (hybrid) demand down,” Peper says, echoing sentiments expressed here earlier byMotor Co.’s marketing chief and former Motor Corp. executive, Jim Farley.
Farley suggests overall hybrid sales in 2009 may not reach the 158,884 units set by the Prius last year, whose own deliveries fell 12.3% in 2008, compared with prior-year.
But Peper says GM has “held in there tough. With (the) Tahoe, Yukon and Escalade (hybrids), it seems to have resonated with people buying large utilities.”
Overall light-vehicle deliveries this year are off to a weak start, although GM appears to be ahead, he says. “Sales are OK. We started off the month a little bit stronger, and we’re hanging tough, performing better than the industry right now.”
Peper also promises Chevrolet will gain market share in 2009, due mostly to a busy cadence of new-vehicle launches. The Traverse midsize CUV arrives at dealers in volume this month, and the Camaro sports car and Equinox small CUV both will be launched later in the year.
“But it’s still not going to be an easy thing to do,” Peper admits regarding holding onto market share. “I just think it’s important we set a robust goal and go after it.”
With this in mind, Peper pledges to continue working with dealers to improve throughput, rather than push outright consolidation, as a long-term goal for Chevy’s retail network. Larger-market Chevy dealers presently average about 800 units annually, and Peper would like to reach 1,300-1,500 deliveries.
“In our smaller markets, to have a lot of dealers out there, it’s a great advantage to us,” he says. “They have a great market share and most are pillars of their communities. Where we need to work to reduce our dealers is in major metro markets.
“We need to provide throughput for our dealers that is comparable to what Toyota provides (its) dealers, so (our dealers) can continue to invest in their facilities and franchise to make it better.”
Peper says he looks forward to Barack Obama as the nation’s 44th president, who took his oath Tuesday. “It’s going to be fantastic. President Obama was very supportive of the automobile industry and realizes its importance to the overall economy. He’s said some favorable things, like 1 million electric vehicles on the road by 2015. That’s very good stuff and things we like to hear.”
At the same time, Peper expects “tough, exacting” expectations from the new administration when it comes to the federal bridge loans GM andLLC received from taxpayers to survive the economic downturn. “I feel very, very good about (Obama) coming into office.”
Peper also seeks to dispel what he considers “falsehoods” about the domestic auto industry to emanate from December’s Congressional hearings.
Being in a fishbowl doesn’t bother him, he says, but he’d like to clean up the water and argues, with supporting data, that Americans do buy domestic products, whose quality ranks on par with Asian transplants, as does their overall fuel efficiency.
“Like many of you, I was fascinated by the political theater that played out on C-SPAN last year, as the leaders of the Big Three went before Congress to make the case for short-term bridge loans,” Peper tells the annual conference.
“But I was horrified at the same time. I couldn’t believe so many of our legislators knew so little about our industry and our great products. It was like watching a time warp:, and being treated like they were Nash, Studebaker and DeSoto.”
As such, Peper promises “disruptive” Chevy advertising in 2009, with the message focused on the brand’s value, styling and fuel economy.