2019 Silverado Launch Will Be Costly For GM
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Bringing new full-size pickup trucks to market will be a costly endeavor for General Motors. The 2019 Silverado launch, along with that of the upcoming 2019 GMC Sierra, will keep GM’s capital spending in the $8.5 billion range. After that period, the automaker projects a decrease in capital spending.
“But then going beyond that, based on a number of decisions we’ve made to simplify the business, we would expect capital investment in the core business to come down from that peak level,” GM Chief Financial Officer Chuck Stevens told WardsAuto.
Increased capital spending is not a new development for GM, as the figure is in line with the elevated investment structure for the automaker over the last few years. Moreover, any new vehicle launch typically involves higher costs mostly associated with re-tooling plants and getting suppliers online. And, given that the Silverado is GM’s best-selling model whose production spans various plants that all need to be tooled, a significant financial outlay for the 2019 Silverado launch, and that of its GMC-branded cousin, shouldn’t come as much of a surprise.
The 2019 Silverado 1500 was first shown in December 2017 and then fully revealed in January 2018 ahead of the North American International Auto Show in Detroit. The all-new truck is significantly more modern and advanced than the one it replaces. It rides on an all-new architecture (GM T1 platform) and features more room in the cab and bed, while being significantly lighter than its predecessor.
The all-new 2019 Silverado 1500 also features an updated powertrain lineup, including a new 3.0L Duramax diesel engine, a significantly expanded model range totaling eight trim levels, more comfort and convenience features such as HVAC for the second row, heated rear seats, more storage in the cab and bed, along with a new power tailgate that can be opened and closed by key fob, a button in the cabin or by hand.
The 2019 Silverado launch cadence will commence with the truck first entering production at the GM Fort Wayne, Indiana plant, while Silverado Crew Cab models will be made at the GM Silao plant in Mexico. Chevy says that customer deliveries will begin in the fall of 2018 across the United States.
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I wanna know how much they’ve invested in Project ZERV…
It takes money to make money.
In this segment it will take more money and more changes to remain competitive and compliant with regulations.
The volume will take care of spending here. Now you would not want to spend 8 billion on a Sonic though.
Agreed about the volume/payoff for the segment. But in that regard, it’s really interesting that they seemed to have omitted some of the more noticeable checklist features like a panoramic moonroof, Electronic Precision Shift, etc. Whether that will have a real-market impact is unknown, of course.
PS: the $8.5 billion is capital spending across the board… it’s not exclusive to a single model or two (Silverado/Sierra). And though the subcompact cars segment in which the Sonic competes is not anywhere as profitable as that of the full-size trucks, VW, Toyota, Honda and Nissan have all found ways to make decent money here… something that GM is still trying to figure out.
I agree with you, oddly the base trucks seem pretty well equipped with the 7″ screens, Carplay, AA and wifi (for a fee)…Yet it appears the premium buyer may be turned off by High Country lack of luxury options; hopefully this is intentional and the Sierra Denali will have all the goodies…
You may want to look at some of the interviews. The lead on the program let it be know not all has been stated or released at this point.
There is much to come yet as GM is holding back much on these trucks yet.
I get the feeling they have much they do not want to telegraph about these truck.
Look for them to trickle the info out over the months till release.
I get the feeling that some of the obmission will be addressed by release.
Also with the release of the GMC still pending they may have saved some news for them too.
I have a feeling they will release news for the GMC either at New York or in Chicago. I think mainly Chicago, as it’s known for it’s Truck showcase.
Worth every penny
It’s all about flexible production operations and platforms. GM started this program near 10 years ago, and is now in the later stages of completion.