Wednesday, February 10, 2010

Rumored - Saturn Sky Death Imminent

General Motors launched a set of sexy roadsters a few years back under the Saturn and Pontiac banners. The Saturn Sky and Pontiac Solstice along with the Opel GT and Daewoo G2X were developed to bring excitement to each brand, two-seat rear wheel drive sports models with a flair for styling.

Rumored - Saturn Sky Death ImminentAlas, the fortunes of the Saturn Sky and its siblings appears to be coming to a quick end. GM Inside News, an independent voice that analyzes the big automaker, is hinting that the Sky will be no more, exiting the scene in the very near future.

Rumored - Saturn Sky Death Imminent
Rumored - Saturn Sky Death Imminent Let's take a look at the reasons why the Sky will likely be no more:

Too Expensive To Build - The Sky's Kappa II platform is too expensive to build. In fact, if reports are correct, the automaker is losing at least $10,000 on each vehicle sold. Never a significant seller, the Sky is an attractive and fun model, but trails the Mazda MX-5 Miata in most rankings.

GM Is Bleeding Cash - General Motors is bleeding through cash this year, at a rate much higher than they thought possible at the beginning of the year. With gas prices topping $4 per gallon, the automaker is scrambling to switch over to a fuel efficient fleet, trimming low performing and expensive inventory in the process.

High Gas Prices Have Changed Everything - In times past when GM could absorb the losses on the Sky, Solstice, GT, and G2X, lower gas prices kept demand for its profitable SUVs and big pickup trucks high. These bigger vehicles are the most profitable for GM and could offset the loss from selling the little roadsters. No more. With sales plummeting, GM has few golden models to rely upon to bolster its line up of loss leading, image roadsters.

Though the Sky isn't a pig on fuel, cash strapped consumers who can still afford a new car are going with much more fuel efficient and practical models. In heady economic times a roadster would sell, but these times are anything but that.

It is unfortunate to hear that the Sky, Solstice, GT, and G2X will be cut, but given the fortunes of General Motors, it seems to be a wise decision from a business point of view.

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