The new Chevrolet Malibu, which reaches U.S. showrooms in a few months, is something of a major milestone for General Motors. It is GM’s first true “world” midsize sedan. Virtually identical cars will be pitched to buyers in Europe and Asia as well as North America.
With the Malibu, GM (GM) is taking another step in fulfilling a goal it has pursued in fits and starts for two decades: to engineer and design mainstream vehicles that can be built and sold worldwide. The delay in gaining global manufacturing efficiency was symptomatic of the disease that helped bring on GM’s 2009 bankruptcy. Now, achieving global efficiencies of scale will help reduce costs and drive GM’s profit higher.
But the 2013 Malibu means more. In the U.S., the car represents GM’s best effort to date to break the grip that Toyota’s (TM) Camry and Honda’s (HMC) Accord, as well as Hyundai’s Sonata and Nissan’s (NSANY) Altima, have on the midsize segment. “My sense is that this car will be globally competitive,” said Rebecca Lindland, an analyst for IHS/Global Insight. “Camry and Accord aren’t the default choice anymore for buyers of midsize family sedans.”
On Friday, Dan Akerson, GM’s chief executive officer, said the new Malibu will appear in U.S. showrooms “six to eight months” ahead of original plan, in order to avoid discounts and other incentives that might be necessary to continue selling the current model. Prior to bankruptcy, GM was apt to allow models to stay in the marketplace too long, he said.
GM’s smaller Chevrolet Cruze was also built on a global platform. Using scale as an advantage, such as Toyota did with the Corolla and other worldwide models “is a work in progress for GM. Each time gets better,” said Tracy Handler, a production analyst for IHS/Global Insight. Global scale allows GM to spread design costs over a large number of vehicles, as well as order the same types of manufacturing tools for all its plants.
Malibu will be built in GM assembly plants in Fairfax, Kansas and in Detroit, as well as in Shanghai, China and Pupyong, South Korea, according to IHS/Global Insight. The new model is a bit shorter and wider, with more interior room for passengers and a bigger trunk; the styling is sportier than its predecessor. The car starts at about $22,000 at American dealerships.
So far in 2011, the Toyota Camry leads the midsize family sedan segment in the U.S., with just over 275,000 sales, followed by the Nissan Altima with about 243,000 sales. The current Malibu, which will be replaced by the new model, has sold about 192,000 units, probably 20% to 30% of which were lower-profit sales to government and daily rental fleets.
The first version of new Malibu to appear in the U.S., priced at about $26,000, will be the Malibu Eco with e-assist, a mild hybrid system, delivering 25 miles per gallon in the city and 39 miles per gallon on the highway. At rest, such as at a stoplight or in traffic, the gasoline engine shuts down entirely. A battery-powered generator can restart the car and engine when the accelerator is depressed; it also helps the engine during acceleration or passing. Such hybrid versions are increasingly common as automakers attempt to meet stricter federal Corporate Average Fuel Economy rules.
The Cruze has proved a hit for Chevrolet and for GM, with sales of 215,000 so far this year — just behind Toyota’s perennial best-seller, Corolla. Now, GM is banking on the hope that the Malibu has the same potential.