General Motors Corp. confirms it has scrapped plans for its Zeta rear-/all-wheel-drive car platform for North America that was to spawn a series of midsize and fullsize passenger cars and cross/utility vehicles, industry sources say.

Zeta, which is under development at Holden Ltd. in Australia but also was to be produced in North America, is being shelved for North America, due to cost issues.

The news GM is suspending the program for North America comes just days after the auto maker revealed it was falling short of its financial targets and planning to speed up development of next-generation fullsize pickups and SUVs in order to rejuvenate sales in its most profitable segment. GM wants to divert money from Zeta toward the acceleration of the pickup/SUV program.

Among U.S. models that were expected to be drawn from the Zeta platform were the next Buick Park Avenue sedan, a production version of the Buick Velite concept convertible, the next-generation Pontiac GTO and possibly fullsize sedans for Chevrolet. A performance car and a CUV might also have been built off the platform.

The Zeta program will continue for Australia and Europe, where it will be used for the next-generation Holden Commodore and Opel/Vauxhall Signum flagship sedans.

The first of the Zetas, including the next GTO, were slated for the '08 model year. The GTO could stay on the market in the U.S., but it now would have to continue to come from Australia.

Lower sales in North America, plus a tougher pricing environment and more car-based sales mix in North America are reasons for GM's financial revisions, according to GM Chairman and CEO Rick Wagoner.

GM now forcasts a loss of about $1.50 per share in the first quarter, excluding special items, compared with a previous target of breakeven or better. GM also forecasts negative operating cash flow in 2005 of roughly $2 billion vs. the previous target of positive $2 billion.