Should GM Close Its Lansing Craft Centre Assembly Plant
January 1, 2006
By Scott Lewis
On November 21st General Motors announced a number of plant closings. I do not know enough to comment on all the plants, but I do think one of those closings is a mistake.
Lansing Craft Centre
The Lansing Craft Centre is where GM builds the Chevrolet SSR convertible pickup. This Pickup has a retractable hardtop. It is a slick, but expensive piece of engineering. The roof is split in two as it is lowered and stored away. This is not unusual. What makes this vehicle's drop top unique is that the top halves are stacked vertically behind the passenger compartment, due to the lack of a traditional trunk. GM is closing the Lansing Craft Centre because of poor sales of the SSR pickup.
The SSR & Price
If sales of the SSR are below expectations, why didn't GM offer a bigger discount for them during their Employee Discount For Everyone program, or there Red Tag Event. I didn't price the SSR during the Employee for Everyone, but the Red Tag price for a "base" SSR was $38,059.07, down from a MSRP of $39,990.00. That's only a savings of 4.8%.
For comparison I also priced a 2006 Silverado 1500 WT 1WT Extended Cab with a MSRP of $34,835.00. Its Red Tag price was $27,869.14. Wow! That's a discount of almost exactly 20%. What gives? Is the Silverado pickup moving too slow? Why does a 34K truck, one of GM's best selling vehicles, get almost a 7K discount while a slow moving vehicle that cost 40K only gets a 2K discount? This doesn't make any economical sense. Can someone explain this to me?
The Wrong Start
Since it came out I have complained that the SSR was too expensive. When GM first rolled out the concept they said they could build it for a sale price of about $32,000. It took a while to get it to production, but when it arrived it cost over $40,000. Ouch! That is quite a price spread.
I have heard that the top mechanism for the SSR costs approximately $10,000 to manufacture. This begs the question, why not build a coupe version of the SSR for approximately $30,000 (maybe even a little less).
Look at the SSR. It looks cool, even with the top up. If you made it with a fixed roof you save $10K. Remove the tonneau cover and save a few more dollars. Leave the bed a simple painted surface and save even more.
Why, why, why... can't they make this an affordable replacement for the long lost El Camino? This would be a perfect pickup for me. 400 horsepower in a two seater for $30K. It would sell, and they would have a hard time building enough to meet demand.
Priced over $40K this competes with Chevrolet's other two seater, the Corvette. It must also compete with cars like the Mercedes Benz SLK350 and other two seater sports cars. I know that nobody in their right mind is going to cross shop a SSR with a Mercedes sports car... but they are close in price & seating capacity. That's why GM needs to make a coupe version of this car that can appeal to people with a Mustang salary, not a Corvette salary. Expensive two seaters are rarely primary transportation. Those that can afford them usually have them as second cars. The SSR can't compete in that market, so it should logically move down market. It would better compete with the Mustang, GTO or even the Miata. Cars that young people without kids buy because they don't need or care about a back seat.
GM, you need to start building cars that people want to buy... without the need for discounts. The SSR with its retractable hardtop is a novelty, especially at that price. People that can afford a two seater for over forty grand are not buying it for primary transportation. However, at under thirty thousand young people will buy it for primary transportation, and want it real bad.
Don't close the plant; expand the line and make a fixed roof coupe!