Morgan Stanley Is Pretty Sure GM’s Cars Will Soon Go the Way of Ford’s


Image: GM

Given the automaker’s sales numbers, it’s not the wildest prediction. Investment bank Morgan Stanley sees General Motors’ American passenger car lineup — or most of it, anyway — disappearing in the near future.

The move would see GM adopt a similar product strategy as its Detroit Three rivals, with sedans relegated to overseas markets and focus placed firmly on the production of trucks, crossovers, and SUVs. Barring $4 or $5 gasoline, domestic buying habits make this prediction seem inevitable — and there’s already rumblings of an impending cull in the automaker’s stable.

Speaking to Bloomberg Television, Morgan Stanley analyst Adam Jonas said he feels GM will abandon much of its car lineup in favor of light trucks and battery electric vehicles. “The consumer’s kind of done that for them,” he said.

As the Environmental Protection Agency prepares to roll back corporate average fuel economy standards, light trucks — already a breadwinner for all three automakers — stand to benefit. But Jonas said no member of the Detroit Three wants to get caught up in the battle between California (and California-aligned states) and the feds over fuel economy rules. He feels that, if forced to make a choice, GM, Ford, and Fiat Chrysler will head over to team Cali. Battery electric vehicles could replace small cars in the vehicle mix, offsetting the increased fuel economy of a truck-heavy fleet.

Earlier this year, a report claimed GM plans to pull the plug on the subcompact Sonic, with the full-size Impala disappearing after the current generation winds down. Presumably, its Buick LaCrosse sister car would go the same route. While we now know that the Sonic will return for the 2019 model year, it isn’t known whether the subcompact car will survive next year.

GM Korea, which assembles the Chevrolet Spark city car, claims it may ditch that model in favor of a U.S.-friendly crossover model. Meanwhile, GM’s Lordstown, Ohio assembly plant, home of the Chevrolet Cruze, just moved to a single shift. It once housed three shifts.

Sales of all of GM’s sedans are well down from their post-recession highs.

It would seem the writing’s on the wall. While Ford has decided to stop domestic sales of all passenger cars except the Mustang and a crossover-ized Focus, FCA continues production of its full-size sedans. The automaker got out of the small and midsize car game some time ago.

If GM follows suit, it’s possible Cadillac’s upcoming sedans will be the company’s last, though the automaker recently announced a 2019 refresh for the Cruze and Malibu. Camaro production — and certainly that of the Corvette — would surely continue, as sports cars seem to be a segment no one’s willing to drop.

[Image: General Motors]