Morgan Stanley Analysts Predict That GM Will Be the Next Automaker to Abandon Passenger Cars
Despite GM's recent investments in its sedans, those models may soon be on the way out
It’s been nearly two years since Fiat Chrysler Automobiles elected to eliminate the Dodge Dart and Chrysler 200 from its lineup. At the time, the move was perceived as rather risky, as it left FCA with few passenger car offerings for consumers.
Today, that market decision seems to be catching on. In fact, Ford recently announced that it will be phasing out all of its passenger cars, with the exception of the Mustang and a crossover-based Ford Focus.
All eyes are now on General Motors, looking to see if they decide to exit the passenger car market. According to financial company Morgan Stanley, they soon will.
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“All three of the Detroit Three automakers have something in common: They’ve all been exiting the car business,” explained Adam Jonas, an analyst for Morgan Stanley. “We think that GM is going to follow.”
Still, GM hasn’t announced any plans to eliminate sedans and other passenger cars from their lineup. In fact, they’ve done quite the opposite.
Chevrolet recently unveiled refreshed designs for its Cruze, Malibu, and Spark vehicles. Furthermore, despite rumors that the Sonic was on the chopping block, Chevy’s signature subcompact car is set to return for the 2019 model year.
GM’s CEO Mary Barra recently signaled the company’s commitment to sedans, calling the segment “significant.” Barra went on to say that although the segment is in the decline, it still presents opportunities.
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Yet GM CFO Chuck Stevens was not as enthusiastic about the fate of GM’s passenger car lineup. Stevens recently told reporters that GM is already set to “make significantly lower investments” toward sedans.
With fellow American automakers fleeing the passenger car market, GM might be able to take advantage of a segment with reduced competition. Conversely, the automaker might follow a growing trend and quickly abandon its sedans. Which path GM decides to take remains to be seen.