General Motors will lean heavily on the 2016 Chevrolet Malibu to help boost its profits and grow its market share with plans to move more than 250,000 examples of the mid-size sedan a year, Reuters reports.
Last year, GM said it will move about 225,000 2016 Malibus a year once the model debuts in New York this coming April. However suppliers have more recently been told to prepare for sales of 250,000-300,000 units a year, much more than the eighth-generation car ever managed.
The new Malibu is also expected to deliver $1,500 more profit per car than its predecessor, GM officials told Reuters. Combined with the forecasted sales increase, GM is looking for about $450 million in additional profit from the new mid-size sedan. If it’s as successful as predicted, the Malibu will play a crucial role in CEO Mary Barra’s plan to achieve 10 percent profit margins and a 20 percent return on capital.
To achieve these ambitious sales figures, the Malibu will have to blow its competition out of the water. The Malibu nameplate has consistently lagged behind segment-leading rivals like the Honda Accord, Hyundai Sonata and Toyota Camry, so Chevy will be tasked with convincing buyers their new Malibu is worth a look. To do this, the automaker will run ads showing off the car’s modern styling, improved fuel-efficiency and new safety and connectivity features.
“If you’re going to beat the champ, you can’t just win on split decision,” Steve Hurley, owner of Stingray Chevrolet near Tampa, Florida, told Reuters in an interview. “You’ve got to knock him out. That’s what the (new) Malibu has to do.”
Industry analysts aren’t totally convinced GM can turn the Malibu nameplate into what it wants it to be. LMC Automotive predicts Malibu sales will barely crack 200,000 units in 2016 before dropping back into the 100k range, just as the current model did. IHS forecasts Chevy moving about 200,000- to 210,000 Malibus a year.
There’s not enough elbow room in the segment for every automaker to meet their sales goals, explained Nissan’s VP of U.S. sales, Derrick Hatami, so Chevy will have to give customers a good reason to pick the Malibu over its rivals if they wish to reach their objectives.
“If you add up all of the sales objectives of all the different nameplates, it’s probably twice as big as the segment itself,” Hatami told Reuters. “Everybody’s got very lofty objectives.”