GM relies on its refreshed Chevrolet Silverado and GMC Sierra full-size pickup trucks to prove customers and investors the US No.1 automaker is back in business.
The muscled-up and more refined 2014 model-year trucks are of utmost importance for GM and the most critical launch since its bankruptcy bailout in 2009. The models also represent the automaker’s change to keep its position as the US No.1 automaker, as Ford, which holds the second place, has big plans to this situation with its F-150 truck, which is the industry’s top-selling vehicle.
“There’s nothing more core to our business than our trucks,” said GM North American President Mark Reuss. “Our competitors may think that they have smooth sailing ahead, but let me tell you the weather is about to change.”
According to analysts’ estimations, GM has invested between $3 billion and $4 billion to develop the new truck range and related engines, as well as revamping the facilities where they are being manufactured. If the new trucks are not a success, the 26% in GM owned by the US Treasury might be at risk, as analysts suggest divestiture might occur closer to the trucks’ launch next year.
The new truck and SUV versions are expected to generate a profit of more than $12,000 per vehicle and account for 60% of the automaker’s global profit. Citi also estimates that the refreshed models could add GM’s operating earnings an additional $1 billion in 2013 and 2014.