Why Is GM Betting Big on Large SUVs?
General Motors (NYSE:GM) is betting that the big SUV isn’t dead. The company unveiled its new 2015 Chevrolet Tahoe and Suburban models in New York and 2015 GMC Yukon and Yukon Denali models in Los Angeles on Thursday, pouring big money into a segment of the auto industry that has shriveled since the financial crisis.
Some of the new features being offered on the vehicles, which haven’t been redesigned in seven years, include improved fuel efficiency, automatic fold-down seats, and new antitheft features. GM said that all four of the new SUVs will have EcoTec3 engines that will make them the most fuel-efficient vehicles available in the full-sized SUV segment. Though that segment may not be what it was seven years ago, it’s still an arena that GM dominates with a 74 percent marketshare as of the end of August 2013.
A report from the Wall Street Journal pointed out that the days of giant SUVs being a status symbol are long gone, since the economic crisis made people more conscious of the money they spend on gas. But, GM has improved the fuel efficiency on the vehicles, and believes there is still a significant number of consumers in need of larger vehicles.