Searching for ways to reduce engineering and model development costs over the next generation of vehicles, General Motors is proposing to extend the life of the platforms underpinning its vehicles.
The strategy will see key chassis components carried over from one model to the next, while the bodywork, interiors, electronics, and other elements will be overhauled to keep products competitive.
At the same time, GM is looking to reduce the number of platforms used across the company, and has already started its consolidation program, the results of which can be seen with the D2XX platform which sits beneath small cars like the new Chevrolet Cruze and Opel Astra, as well as large SUVs including the Buick Envision.
Now GM president Dan Ammann has revealed that D2XX could potentially be expected to live on twice as long as originally expected.
The cost-cutting move comes as a solution to stem potential losses from the slowing growth of vehicle sales in GM’s prime North American and Chinese markets.
Along with development cost savings, GM will also be able to leverage cost savings from component suppliers, able to sign longer-term contracts to stabilise one area of the company’s spending.
GM’s spending isn’t set to be reduced immediately however, with GM’s capital expenditure likely to increase to US$9 billion per annum in 2019, compared to $US7 billion in 2014.
Following the spending spike, once cost saving measures are in place, capital spending is expected to return to 2014 levels, according to Mr Ammann.
Other potential savings could come from lower material costs as GM’s engineers work to strip excess weight out of vehicles, delivering both environmental, and cost benefits.
General Motors is also looking to divert spending away from areas like stamping dies and welding machines, to its electric and autonomous vehicle programs, now managed under one executive to speed development times.
China is also a key part of the cost-cutting program, with Mr Ammann revealing that by sourcing stamping dies used to make vehicle components from China, GM was able to reap saving of between 20 and 40 percent compared to the US or Europe.
MORE: General Motors News
- Interested in buying HOLDEN ? Visit our HOLDEN showroom for more information.