GM Will Lose 25% of its Hybrid Vehicles When Saturn Closes

When General Motors closes down Saturn later this year, it will lose just over a quarter of its sales of fuel-saving hybrids -- the type of vehicles that the Obama administration wants automakers to build more of.

This is not what GM needs right now if they are going to change their image. Not only will they lose the Saturn hybrids, they will also lose some of their most fuel efficient lineup.

And it's not yet clear how the end of Saturn affects GM's ability to meet toughening corporate average fuel economy standards. Because Saturn does not offer a V-8 engine or have trucks or body-on-frame SUVs, it is GM's most fuel-efficient North American division.

Saturn currently sells mild hybrid versions of the Saturn Vue crossover and Aura sedan and last year was second in total hybrid sales among GM's divisions. Chevrolet, with sales of 5,838 hybrids was No. 1.

Saturn had planned to add a more advanced hybrid version of the Vue this summer. But that vehicle, which uses a front-wheel-drive version of GM's acclaimed Two Mode transmission, is now canceled. So is the plug-in version of the Vue, which had been due in 2010.

GM said today that all Saturn production will end with the 2009 model year.

GM does not break out sales of its hybrids. But the National Renewable Energy Laboratory does track sales of individual models. In 2008, GM sold 11,454 hybrids, of which 3,205 were Saturns. The rest were hybrid versions of the Cadillac Escalade, GMC Yukon and Chevrolet Tahoe.

No technology transfer plans

A source with knowledge of GM hybrid plans said hybrid powertrains won't migrate immediately to any of GM's four surviving brands: Cadillac, Chevrolet, Buick and GMC.

"There will be no technology transfer from Saturn," the source said. "There is a lot of doubt internally as to what comes to production. Everything is in the air. Everything goes through the government."

But Mark LaNeve, GM's North American sales chief, said today that Saturn's hybrid technology could end up in any of the company's four surviving brands.

"Any of the four core brands could get our technology," LaNeve told Automotive News. "There's not a hybrid in Saturn that is exclusive to Saturn. Nothing changes there, unless someone who buys Saturn says we want us to continue building hybrids for this brand and we agree to do it."

After Saturn is discontinued, GM will offer the Chevrolet Malibu mild hybrid and Two Mode versions of the Chevrolet Silverado and GMC Sierra pickups as well as the three full-sized Two Mode SUVs.

The fwd version of the Two Mode now likely will not be produced until 2011, said the GM source, who is familiar with the company's hybrid plans. GM officials are deciding which division, Buick or GMC, will get the fwd Two Mode transmission.

The mild hybrid system provides a slight boost upon acceleration and offers a stop-start feature. GM's mild hybrids offer about a 20 percent fuel economy gain. The Two Mode version can drive the vehicle on electric power alone and would have delivered a fuel economy gain of at least 30 percent.

CAFE average won't take big hit

John O'Dell, an analyst at Edmunds.com who tracks green cars, said the loss of Saturn's hybrids might hurt GM's CAFE average initially. But the hit would not be too harsh because GM is also phasing out its Hummer and Pontiac brands, which have several models that get poor fuel economy.

"They've made it clear from their recovery plan that the Chevrolet Volt is GM's fuel economy future," O'Dell said. "We know GM has many more vehicles than the Volt in its arsenal that has a Volt-style extended-range powertrain."

O'Dell said he expects GM to deploy some of Saturn's hybrid powertrains in other vehicles.

Dan Becker, director of the nonprofit Safe Climate Campaign in Washington, told Automotive News that GM could not rely only on its plug-in hybrid Volt car, due to launch at the end of next year, because its impact on the market will be "minuscule."

GM will have to come up with new fuel-efficient models to try to keep pace with Toyota, Honda and Ford, among others, Becker said.

Source: Automotive News