GM's New Models: Will They Save The Automaker?

2008 Cadillac CTS Coupe
2008 Cadillac CTS Coupe

Amidst all the talk about GM coming up with $15 Billion dollars to increase liquidity there was an important announcement about new models coming from the struggling automaker.

Seven new ones that will be key to fueling GM'srecovery.

The seven new models include a new Cadillac CTS Coupe (expected summer '09), a CTS sport wagon (yes, Meghan here's the wagon you've been craving) coming in the spring, a Cadillac SRX due in the first half of next year, Buick's Invicta, first shown at the Beijing launches next spring in the United States, Saab's new 9-4X crossover due in fall '09, Chevy's redesigned Equinox coming in May, and the Chevrolet Cruze, a global compact car.

So what stands out on that list? Certainly the Chevy Cruze will be critical because it brings greater fuel efficiency and will be a "world car" GM can sell around the world. If Cruze is a hit, it will show GM can win with small cars.

Buick's Invicta is a gorgeous sedan I saw last spring in Beijing. Buick is dying on the vine with only the Enclave bringing in buyers. Invicta will help change that, but Buick will need even more new models if it's going to rebound.

The trio of Caddy's are important because the Caddy brand has been lagging the last two years due to competition and lack of new models. Cadillac is one area where GM can leverage the brand to sell models at a higher price point with greater margins, increasingly important with the slowdown in truck and SUV sales.

But more than anything, GM's product roll-outs are critical because new vehicles will be needed for a comeback. GM sales are down 16% this year and I'm not optimistic they will come back much in the second half. Which makes '09 crucial to GM's turnaround. If the economy starts to come back and people start buying cars and trucks again, GM hopes these models will be in place to win over buyers.

Remember, you can't cut your way to prosperity. At some point, GM will have to sell more models.

Questions? Comments?