[A90West]

GM has announced that it is cancelling the North American end of its Zeta platform project, which was to have gone into production in 2007 to replace the W body large FWD models. Zeta is a lower cost derivative of the Sigma RWD architecture Cadillac uses. According to the announcement, Holden will still be proceeding with Zeta for Australian production.

Seems to me that in light of its financial troubles, GM may now be attracted to sharing Holden's development costs for this platform with third parties. This may be a more promising way for MGR/SAIC to build a large car than stretching the R75 platform. Given that SAIC already build the W body Buick Regal under license, I wonder whether it couldn't use its contacts to make such an idea work. Any thoughts?

 

[xerif]

GM has announced that it is cancelling the North American end of its Zeta platform project, which was to have gone into production in 2007 to replace the W body large FWD models. Zeta is a lower cost derivative of the Sigma RWD architecture Cadillac uses. According to the announcement, Holden will still be proceeding with Zeta for Australian production.

Seems to me that in light of its financial troubles, GM may now be attracted to sharing Holden's development costs for this platform with third parties. This may be a more promising way for MGR/SAIC to build a large car than stretching the R75 platform. Given that SAIC already build the W body Buick Regal under license, I wonder whether it couldn't use its contacts to make such an idea work. Any thoughts?

Because GM doesn't want any technology transfer to China...

 

[A90West]

True. But GM Also doesn't want to lose $850 million this year. Desperate times call for desperate measures. And if it's technology that's only destined for Australia, I'm not sure it'd be a big competitive concern.

 

[SteveChilds]

Doubt it - stretching the 75 platform is likely to be cheaper than starting from scratch with a discgarded GM platform which is probably inferior anyway.

 

[PatrickT]

Doubt it - stretching the 75 platform is likely to be cheaper than starting from scratch with a discgarded GM platform which is probably inferior anyway.

Nothing inferior about Zeta. It's also not discarded. It's an all new platform which is designed for large RWD/AWD (note from first post that Zeta is NOT a FWD platform ) applications and it will make its debut next year. By all accounts it's a cracking platform. Zeta is the product of GM's Australian platform engineering devision - a project to make GM's Sigma platform viable for mass production. Please explain why being designed in Australia by GM makes it inferior?


the actual article:

Big News Network.com

General Motors has announced it will no longer develop new rear-wheel-drive platform vehicles in the North American market. [My emphasis to indicate that the platform has been cut because the vehicles it was to go under have been cut.]

Company insiders said the decision to stop developing cars on the platform, code-named Zeta, was made last year, the Chicago Tribune reported Saturday. They said the decision was not related to the company's projected loss of $850 million for this year.

Experts had predicted GM would use Zeta for the next-generation Pontiac GTO and possibly the Buick Velite sedan and convertible, and a midsize Chevrolet sedan.

GM's Holden subsidiary in Australia will continue to develop the Zeta platform.

Source: http://feeds.bignewsnetwork.com/?sid=81a2dafdc726f810

 

[PatrickT]

True. But GM Also doesn't want to lose $850 million this year. Desperate times call for desperate measures. And if it's technology that's only destined for Australia, I'm not sure it'd be a big competitive concern.

It's not destined for Australia - it comes from Australia. Holden - which directly owns Zeta - is a very profitable company. That's why they call their own shots within the GM hierarchy. Holden won't see any reason to sell or even license their cutting edge new product to China.

 

[Roodosutaa]

Please explain why being designed in Australia by GM makes it inferior?

Yeah I'd like to hear an answer to that too.

Holden has become GM's global centre for large RWD platform design, what this basically means is from last year on, anything large and rear drive will ride on a platform developed in Fisherman's Bend, South Australia, yes that means Cadillacs, large Chevy's and even possibly the next Vauxhall Omega will be a Holden design underneath if they decide to make it RWD.

Holden holds a similar advantage MGR has in that its size is miniscule in comparison with the rest of the GM world and this gives it a lot of flexibility when it comes to R&D and development costs are also significantly lower, turnaround time is also faster.

 

[PatrickT]

Holden is a fair bit bigger than MGR, but I agree with yoru sentiment.

 

[A90West]

What's clear is that GM isn't now going to use the Zeta platform to replace the Chevy Impala & Monte Carlo, Pontiac Grand Prix & Bonneville and Buick LaCrosse. That was the previous plan (i.e. replace them with a rwd platform to compete with the Chrysler 300). As far as I'm aware, GM hasn't ever said whether it actually will use Zeta to build a new big Opel/Vauxhall or to replace the Saab 9-5, though there have been rumours that such vehicles would be built on either the Zeta or Sigma platforms.

However efficient, flexibile and profitable Holden is, the volume of product built from the Zeta platform by GM is now going to be considerably smaller. That will be true whether Zeta cars are built in Europe and whether Holden exports as it is doing with the Monaro. That necessarily means Holden's profit, if any, generated from development of the platform will be smaller unless someone else will share the cost, and its contribution to GM's overall bottom line will be smaller.

Now, it may well be that the incremental profit gained by cost-sharing wouldn't be worth the long term strategic consequences to GM of technology transfer to China, but these appear to be pretty desperate times at GM. North American market share is collapsing. They're being forced to cut investment in new product. Management appears weak. Aside from industrial relations, their current situation doesn't look all that different to BL in the 70s.

 

[PatrickT]

even on Holden alone Zeta will account for a minimum of 120,000 units a year.