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General Motors' 2012-MY Fleet Product Preview

General Motors gathered its fleet friends and family together in Palm Springs earlier this year to show off its product and give a glimpse into the future.

July 2011, by - Also by this author

General Motors gathered its fleet friends and family together in Palm Springs earlier this year to show off its product and give a glimpse into the future. While the annual event was itself subdued, the mood was more celebratory than it has been in a few years. GM has been profitable since the first quarter of 2010 and last year marked the first full year of profits since 2004. 

You can check out a photo gallery of GM's fleet product preview event here.

As you might expect at a fleet preview, GM reiterated that "fleet business is good business." But the numbers back up the talk: GM's sales to commercial fleets are up 8 percent year over year, while fleet sales represent 25 percent of total U.S. sales. GM pointed out that sales to small businesses were up 30 percent in the first quarter. In terms of the Japan crisis, GM predicts it "will not have a material impact on 2011 performance." GM expects overall fleet sales for the industry to remain steady at 2.5 million vehicles for each of the remaining three quarters of 2011. 

While GM's sales numbers alone will not affect your fleet's bottom line, they play into GM's residual value story. Not only have new and revamped models given GM nameplates a healthy residual value forecast bump moving forward, but the lack of supply in the used car market means that your two- and three-year-old vehicles are worth a lot more than original projections. 

Watch for used supply to get even tighter starting in November, as the market processes the effects of the captive finance companies' pulling out of leasing in 2008. Think about that when making your cycling plans.

More MPG, Less Premium

In terms of other macro conditions, GM is addressing the continuing shift to more fuel-efficient vehicles from many different angles. 

While GM has carved a niche with hybrids for SUVs and trucks (Chevrolet Tahoe, Chevrolet Silverado, GMC Yukon, GMC Sierra and Cadillac Escalade), it has a game changer in its eAssist, or "light electrification" technology. eAssist uses a small lithium-ion battery and a 15-kw motor-generator to provide an electric boost during heavier acceleration, fuel cut off during deceleration, regenerative braking and use of electricity, not gas, when stopped. 

The technology is expected to deliver a full 25 percent more fuel savings, which rivals that of some full hybrids, without the hybrid price premium. That has to be attractive to fleets and total cost of ownership. eAssist comes standard in the 2012 Buick LaCrosse (an estimated 25 mpg city, 37 highway) and optional in the 2012 Buick Regal (25/37), on sale this summer, and will be an option on the 2013 Chevy Malibu (26/38), available in the first quarter of 2012. 

Other fuel economy savings come from wringing everything GM can out of the good old internal combustion engine, with technology such as variable-valve timing, active fuel management and direct injection. In terms of alt-fuels, GM has new LPG offerings on the way. (See below.)

The engine mix is changing too: Last year, 46 percent of GM's sales were of four-cylinder vehicles, up from only 25 percent five years ago. 

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