DETROIT - General Motors' 15-year manufacturing venture with Toyota Motor Corp. could give GM part of the solution to its small-car woes by 2002.
The-Fremont, Calif., venture, New United Motor Manufacturing Inc., is expected to begin production of a Toyota Corolla-based sport wagon for Toyota and GM in 2002.
During an interview on Tuesday, Oct. 26, GM Chairman Jack Smith would not confirm that GM is getting the sport wagon, but said that the automaker is looking beyond typical sedans and coupes in the small car segment.
'I think we'll see a future product (at NUMMI). Not something I can talk about, but we certainly will have a product change at some fu ture date that I think will be better for the GM brand,' Smith said.
GM loses money in the small-car market, where it has a clutter of entries including its top-selling car, the Chevrolet Cavalier, as well as the Pontiac Sunfire, the Chevrolet Prizm, the Saturn S series and the budget Chevrolet Metro.
NUMMI builds the Prizm alongside its sister car, the Corolla. However, GM likely will drop the Prizm when Toyota redesigns the Corolla for the 2003 model year.
In August, a local union official at the NUMMI plant said company officials showed union leaders a possible replacement for the Prizm, a Pontiac-based sport wagon that he described as a mini minivan.
Smith said the problem w ith small cars is that competition from larger used cars is putting a lot of price pressure on the segment.
'So the question is, how do we get a product that's more competitive and has more size to it and more potential for profit at the bottom end of the market. That's a big challenge,' Smith said.
'The market has changed so dramatically that maybe we need to look at different types of vehicles in that portfolio rather than straight sedans and coupes,' ' he said.
GM also is collaborating with Toyota on developing alternative vehicles. Asked whether GM might get a version of the new Toyota Prius, the Japanese company's gasoline-electric hybrid car, Smith said that is not being di scussed.