Topic: Good Problem to Have

[Ultra]

GM's low-volume sports cars selling out quickly, Lutz says

Here's a good problem for General Motors: Many of its low-volume sports cars, including the yet-to-be launched Saturn Sky, already are sold out for either this calendar year or model year, GM Vice Chairman Robert Lutz said.

The list of in-demand cars includes the Chevrolet Corvette and Pontiac Solstice.

Lutz cited the cars' sold-out status to prove a point that naysayers who claim GM does not build vehicles people want to buy are wrong. He made the comments during a speech in New York on Wednesday, Aug. 12.

"Let's look at some of our awful, boring products and see just how unpopular they are," Lutz joked just before noting the status of the sports cars.

Saturn plans to launch its roadster, the Sky, this spring as a 2007 model. There's just one issue: "All available production for 2006 is accounted for. In other words, sold out," Lutz said.

The Sky shares its Kappa platform with GM's other hot roadster, the Pontiac Solstice. The Solstice has the best turn rate of any vehicle in its segment, Lutz said, adding that the car is sold out for the 2006 model year.

Pontiac launched the Solstice last year, and by the fall Pontiac had about 13,000 orders in hand - but expected to build only 7,000 units by the end of 2005.

As of March 1, GM had delivered 10,000 Solstices to dealers, a Pontiac spokesman said. But customers are still likely to wait a few months for a Solstice. The roadsters are often selling for more than their starting sticker price of $20,490, including shipping, the spokesman said.

Pontiac executives in February said they planned to build 20,000 units of the Solstice in 2006. The Solstice and Saturn Sky are built in Wilmington, Del.

The Chevrolet Corvette also is sold out for the 2006 model year, Lutz said.

Lutz pointed to GM's boost in production of the Chevrolet HHR wagon from 60,000 units a year to about 132,000 units because of demand.

"March was (the HHR's) best retail month since launch, with very little spent on customer incentives," Lutz said. Chevrolet sold 8,698 units of the HHR in March.

GM spent $855 a unit on the HHR in March, according to Edmunds.com, an industry research firm. That compares with the $759 a unit GM spent in January. GM launched the HHR in August and spent $437 a unit on incentives then, according to Edmunds.com.

Demand for the Chevrolet Impala sedan is at 300,000 units, but GM will build only 250,000 this year, Lutz said. That strategy supports GM's plan to lower incentive spending and raise transaction prices by not flooding the market.

According to Edmunds.com, GM's incentive spending on the 2006 Impala was $1,890 a unit in March, compared with $5,184 a unit one year ago.

The Buick Lucerne is off to a healthy start since its November launch, Lutz noted. For March, the sedan had a 25-day turn rate and 91 percent of its sales were to retail buyers, Lutz said.

Edmunds.com showed the Lucerne's turn rate was 32 days in March with GM spending $1,429 a unit on incentives. According to Edmunds.com, that's down from an 80-day turn rate and $4,016 a unit in incentives in November.