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GM Cancels All Future Full-Size SUVs

 GM Cancels All Future Full-Size SUVs
Cadillac Escalade Hybrid

In a move that would have seemed implausable a decade ago, General Motors have cancelled a $2 billion investment program to update their range of full-size SUVs, the staple breadwinners of the 90s. Pulling the plug on Project CXX, which was set to underpin future versions of the Escalade, Yukon and Suburban, was unanimously approved by executives, ending 15 years of vehicles that defined the brand.

“It would have been very difficult in today’s environment to spend a couple of billion dollars to do a replacement,” said Robert A. Lutz, G.M.’s vice chairman and head of product development. In a market faced with soaring fuel prices and consumer demand for more compact, more efficient cars; “reality had set in.”

But with sales of SUVs steadily falling since 2004 and the company posting an $18.8 billion loss in the first half of the year, GM are in troubled waters. Share prices have seen drops of as much as 76 percent on the year - but they are by no means alone. Ford shares are down 70 percent over the same period, while Chrysler, like GM, may also loom on bankruptcy. But it is General Motors which has suffered and will suffer most, its passenger cars sold as loss-makers and its success dependant on its line of sport-utility vehicles.

Lay-offs at GM plants are set to continue, with Janesville, the firm's oldest and most reliant on SUV production, being announced earlier this month as to close by Christmas. And if the potential merger goes ahead with flailing Chrysler, further job losses are expected, adding to the some 40,000 hourly workers already made redundant in the last three years. Hopes that a new small car could fill the production line at Janesville were dashed as GM made a committment to its Arlington plant for future developments.

GM Chairman Rich Wagoner says development of smaller cars and lower-capacity engines will be sped up, also redeclaring the company's commitment to delivering the electric-drivetrain Chevrolet Volt by 2010. Further resources are being poured into development of the new Chevrolet Malibu and its crossover entries, the Buick Enclave and GMC Acadia, as well as the continued development on hybrid systems.

Published Oct 28, 2008 9:28 am By Sam Stockley

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Comments (34)

 EJ255 EJ255
Finally!
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November 9, 2008 4:30 pm
 Panuzzi Panuzzi
Not to mention some European countries tax extra for "heavy" cars.
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October 31, 2008 7:41 pm
 Motor_Yakuza Motor_Yakuza
We all gonna miss this big guys..
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October 29, 2008 10:45 pm
It would be just a simple and the best deal to put baby Duranmax 4.5 l to Buick Enclave, for example. This engine was tested by EPA in Buick Rainer, the press was amazed and the fuel efficiency was way over 30 mpg! Can We Americans drive fuel efficient SUVs? Mercedes GL and Audi Q7 are in the offer, why not Escalade or Suburban as well?
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October 29, 2008 4:41 pm
 joelynn joelynn
Where I come from 18mpg is pretty appalling. Us europeans get by just fine with cars that do 40-60 mpg. With fuel at $10 a gallon we couldnt afford 18mpg even if we wanted some old fashioned monster truck, and when fuel is running out it seems a bit obscene to do that kind of mileage.
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October 29, 2008 12:45 pm
 Wickedated Wickedated
RADMEISTER: For the $ of that Tahoe you could of bought a Dodge sprinter diesel, tow more,(WRONG) carry more cargo, and save on fuel (WRONG AGAIN), and then bought a used Prius on top. (WRONG. TAHOE $ DOES NOT EQUAL SPRINTER+PRIUS. I don't know where you learned your math that says that cost of ownership of 2 vehicles is less than one vehicle). They are pointless cars, SUV my ass a tahoe can't do half the off-roading a range rover can, (WHERE I LIVE OUR ROADS ARE PAVED) or a G55. In the SUV category the Tahoe wins at cargo space, but it's also 2ft longer than an X5 or Range Rover, a volvo station wagon has roughly the same cargo space, so what's the point? (mmm.. NOT TO LOOK LIKE A SOCCER MOM?) Hell a V70 R is better on gas (WRONG), can haul more, and is a hell of a lot faster than a tahoe. (SPEED IS IRRELEVANT TO THIS TOPIC)
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October 29, 2008 3:22 am
 Bremen_Koenigsegg Bremen_Koenigsegg
Ha! That's what you get for being stupid.
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October 29, 2008 12:15 am
 Wickedated Wickedated
I have a 2007 Tahoe and let me just say that A) gas mileage is not that bad, I consistently get 18mpg in the city. and B) there are NO other vehicles that can do what a Tahoe does. Period. All other "SUVs" are city movers and are useless when it comes to cargo hauling. I own several bars and I can count on my Tahoe to haul anything from beer kegs to 100lb chicken wing boxes. Ever seen the cargo space of an X5 or Cayenne? Even the Range Rover is pathetic (I used to own one). Bottom line is, these cars are selling and all GM did was erase the 2Billion dollar investment in a NEW platform, that does NOT mean that they'll take out the Tahoe/Escalade off their lines, they'll get redesigned on the old platform and people will still buy them. It's completely hypocritical to condemn large SUVs while cheering for cars like the Veyron, Ferrari and Lamborghinis, that run on 93octane and do 3mpg at BEST.
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October 28, 2008 9:41 pm
 500lbman 500lbman
These domestic manufacturers are kind of like volcanos waiting to explode. Their collective bargaining agreements are costing them so much that they can't possibly afford to design quality vehicles to compete with the imports. It is only a matter of time until they all implode and tons more people lose their jobs. Unfortunately this is the only way things can change. The domestics must completely implode so they can restructure into smaller, design focused, quality car manufacturers. Look at Honda. They make tons of affordable cars that are very reliable and are more refined than their price tags. The domestics have to sell their cars as loss leaders and have banked their futures on SUV's that are no more than truck bodies bolted to truck frames (1930's technology) to try and stay competitive.
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October 28, 2008 9:28 pm
 wjaprep wjaprep
Ha, wow I doubt this, I have never seen more new tahoes than in 2007
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October 28, 2008 9:20 pm
 radmeister radmeister
IN YO FACE!
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October 28, 2008 8:54 pm
 BMWer BMWer
Finally! I'm glad to see them go. I'm sure they'll make something to "replace" it, but thankfully it'll be smaller. You can practically build two cars out of one of those SUV's. So many people have been blind to these excesses, so I'm glad consumers are finally realizing how obscene these vehicle are.
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October 28, 2008 5:25 pm
 rcw rcw
I agree with joelynn and benz_man. I know people have different taste and like SUVs for a variety of reasons, but these vehicles just don't make sense for one person to ride around in all day. They use lots of resources (space+fuel, etc.) and are dangerous in collisions with vehicles that are smaller and lighter. Also, try seeing around one of these things parked on the corner of a busy city street. Good luck! I feel bad for the people losing their jobs but I won't miss the full sized SUVs at all. Only a small percentage of the population legitimately NEEDS a vehicle like this. The mid-sized and smaller SUVs work for most other people.
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October 28, 2008 4:41 pm
 jsb jsb
The "living room on wheels" vehicle will go back to being limited to the wealthy elite who choose a Range Rover. Still, its hard to imagine GM giving up on the Suburban, which has a legacy of selling in low numbers to wealthy niche buyers long before the family SUV craze in the '80s and '90s.
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October 28, 2008 4:40 pm
 mechamynd mechamynd
This is the end of an era.
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October 28, 2008 3:18 pm
 heat_fan1 heat_fan1
Word on the street is that the Suburban and Escalade ESV (no mention one way or the other of other models) will move to Lambda in 2014. So perhaps these babies will be saved, and probably not lose much in size, as big as those Lambdas are. http://www.gminsidenews.com/forums/f70/r...
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October 28, 2008 3:09 pm
 benz_man benz_man
I must agree with joelynn here. GM is turning over a new leaf. The SUV was the replacement for the "Country Squire mobile's". All that ended in the first fuel crunch. Seems no one learned their lesson then...
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October 28, 2008 3:08 pm
 joelynn joelynn
I don't think that these massive SUVs will ever be popular again, not just because of the economy but because oil prices will stay high and there will be ever increasing pressure to consider both environmental and pedestrian safety issues more when making cars. This is the end of these kind of cars and in many ways (except of course for the job losses) this is a good thing.
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October 28, 2008 2:41 pm
 M.V.P. M.V.P.
Oh c'mon , Escalede it's a legend, yeah the gas it's expencive 4 this type of car, but Escalade brings prestige and image to GM, and have a huge publicity in music videos,movies, songs and even in Family Guy, God drives an Escalade. Anyway I think no one knows right now, ware the car industry it's going,with this financial apocalypse , but in 5 years we will have a clear image, I think.
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October 28, 2008 1:41 pm
 mmr66 mmr66
i hate suv's but i love jeeps not jeep jeeps i mean like my mercedes g55 you know a car that can realy go off road anyway good news.
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October 28, 2008 1:35 pm