Is the H1 on it's way out?

[nadepalma]

Source: http://www.detnews.com/apps/pbcs.dll...0342/1121/AUTO

Is H1 on its way out?
Off-road icon may have outlived its utility
Brett Clanton / The Detroit News



General Motors Corp.'s Hummer H1 -- a tank-like SUV used by the U.S. military, sold to the public by GM, and reviled by environmentalists everywhere -- soon may be decommissioned.

While there is no decision yet, Hummer's new general manager, Martin Walsh, said in a few years, the slightly smaller H2 sport utility vehicle could replace the H1 as the brand's flagship model.

The H1, with fewer than 400 sales last year, is still "very important" to the brand's image as an off-road leader with iconic design, Walsh said.

"What we've found increasingly, though, is that the H2 has come to be seen by consumers as the Hummer. In their minds, that's more representative of the Hummer brand than the H1."

The comments come as Hummer is trying to broaden its appeal to consumers and as gas prices hover near $3 per gallon.

In less than 15 years on the U.S. auto market, the H1 has become a status symbol to the moneyed elite -- thanks to enthusiastic endorsements from Arnold Schwarzenegger and hip-hop artists -- and a gotta-have-it toy for hard-core off-roaders.

But its $140,000 price tag, poor fuel economy and massive size have made it impractical for many customers.

"People still like to come in and look at them, but no one buys them anymore," said Dan Frost, owner of Hummer dealerships in Detroit and Novi. "We might sell one, maybe two a year."

The H1 is based on the High Mobility Multipurpose Wheeled Vehicle, popularly known as the "Humvee," which was created by AM General Corp., a military contractor. It went on sale as a civilian vehicle in 1992, and was initially boosted by its exposure in the first Gulf War.

Seven years later, GM acquired exclusive ownership of the Hummer brand name, and in 2002 added the beefy H2. Last summer, the H3, a midsize SUV that achieves 20 miles per gallon, joined the lineup and now accounts for more than half of Hummer's annual sales.

In 2005, after a hurricane-fueled spike in gas prices, H1 sales fell 16 percent and H2 sales plummeted almost 30 percent -- a sign that the brand's biggest growth potential may rest in smaller, more fuel-efficient vehicles.

Walsh said Hummer would consider building a pickup truck, but would not -- as the Chrysler Group's Jeep brand recently started to do -- build car-based "crossover" vehicles.

The "product expansion" planned for the Hummer brand will be based only on rugged truck frames, he said.

Aside from adding a high-performance Alpha version last year, GM has done little to change the original H1, a vehicle it markets as "the most functional off-road vehicle ever made available to the civilian market."

Perhaps that's because the ailing automaker knows it cannot afford to throw money at a vehicle with such a small audience, said Erich Merkle, an industry analyst with IRN Inc. in Grand Rapids.

"There never really has been much of a market for that vehicle, except with the ostentatious crowd."

Hummer continues to require its dealers to accept at least one H1 a year, but with fuel economy becoming a bigger concern for consumers, it may get harder to sell a vehicle that gets 10 to 12 miles per gallon.

Yet Walsh left the door open to H1's future.

"It's still a part of our plan," he said. "Beyond that, I really can't say."

You can reach Brett Clanton at (313) 222-2612 or bclanton@detnews.com.


"What we've found is that the H2 has come to be seen by consumers as the Hummer. In their minds, that's more representative of the Hummer brand than the H1," says Hummer chief Martin Walsh.

[460ford]

The H1 is the only Hummer to me.

[maross600]

Its funny they want to kill the only real Hummer in the lineup. I would think that having a halo vehicle, like the H1, would be to their advantage, and it cant cost them much to produce since its the same vehicle that is being made for the military. They even said themselves when he said people come in to look at them, but dont buy it. Well thats what a halo vehicle does, it brings people to the showroom to move others.

[Rex Raider]

Are they still selling Hummers (or HMMVEES) to the military?
Is that included or not included in the 400 they sold this year?

[GReekBoy]

on all the offroading web sites im on no one considers the H2 a hummer...

[powervette]

if the H1 is gone,other Hummers won't make any sense

[Jeffff]

Part of the reason that sales are decreasing some is due to the lack of updates. Sure, the H1 recently got a new interior and engine options, but the exterior is practically the same as it has always been. A few tweaks here or there might help sales increase more.

Originally Posted by Rex Raider

Are they still selling Hummers (or HMMVEES) to the military?
Is that included or not included in the 400 they sold this year?

My understanding is that AM General still sells the HMMVEES to the military, and is the sole producer of the vehicles. GM only owns the "Hummer" name and the version that is sold to civilians. I'd assume the 400 they sold this year only includes the retail sales of "Hummer" branded vehicles.

[SPDKLZ]

Maybe its just me... But failing to redesign a vehicle after 13 years kinda hangs it out to dry as far as sales go. I dont know where they would take the design and I wont say that I could do any better. But come on. 13 years and no refresh?

[jsford91]

They definitly shouldn't kill it. It is the brand halo vehicle, but i think that if they made a few minor updates and made the exterior design a little more modern it would definitly sell more.

[paul3230]

I'd say kill it...I mean it's great vehicle, but it will continue to draw fire to the brand because of it's poor fuel economy. Plus, how do you redesign a vehicle like that??

[Jay]

Originally Posted by Jeffff

My understanding is that AM General still sells the HMMVEES to the military, and is the sole producer of the vehicles. GM only owns the "Hummer" name and the version that is sold to civilians. I'd assume the 400 they sold this year only includes the retail sales of "Hummer" branded vehicles.

I know the Canadian military uses the smaller, more fuel-efficient G-wagon. If the US still uses the Humvee, it must be one of the few countries that does.

[CADILLACSIXTEEN]

Id say dont kill the H1, but just decrease the volume.

Have it be a supreme halo vehicle, up the price, and have it be very limited, like an exotic foreign car, but the only difference is it's an exotic off roader.

In this way, they would make a couple hundred a year, and it can be regarded as a rare vehicle, therefore making the price increase acceptable and at the same time paying for it's lack of production.

This would, in turn, make the Hummer brand seem even more credible. The existance of the H1 is crucial to the survival of the Hummer brand. What they dont want is the perception of the idea that Hummer's are rebadges of GM siblings, which is the perception of Jeeps today. I must admit, that obviously the H1 is no rebadge, and the H3 just uses platform sharing but it stops there. The H3 is an extremely capable off roader. Infact, it is so good at off roading, some question its on-road abilities. The H2 on the other hand was a great hit at first, but for the next generation, they should put the same effort into making that an off road vehicle as they did for the H3. And this idea goes for all future Hummers too. If they can do this, they can have the image of the supreme off-roading brand.

Let's face it, as time goes buy, Jeep is becoming more and more mainstream. Everyone wants to say Chrysler is doing great but in reality they are just so far behind GM, that they are making all the mistakes GM made in the past decade. They look good now, but they are still mainstreaming everything, and I think Jeep's whole identity is almost diminished. Where on the other hand, GM is in a huge transition of trying to differentiate their brands. Yeah, Chrysler is the "luxuary" brand, Dodge is the mainstream, and Jeep is the off roading. But Dodge and Jeep are getting closer and closer together. I have no idea what Chrysler is thinking by basically rid-ing Dodge of every CAR they have and turning it into some sort of oversized, gas guzzling, hatchback. And then making Jeeps on small, crossover platforms that have ZERO off-road ability. In essance, I think that Chrysler is in more trouble than GM and Ford right now, it is just not visible to the naked eye........YET.

[327]

Originally Posted by Jeffff

My understanding is that AM General still sells the HMMVEES to the military, and is the sole producer of the vehicles. GM only owns the "Hummer" name and the version that is sold to civilians. I'd assume the 400 they sold this year only includes the retail sales of "Hummer" branded vehicles.

I think the H2 plant is even on AM general property and built by them for GM. Im not sure about the H3 though. It could be true, all the way up to the Humvee. I heard awhile back the military was looking for something new

[jbernie]

Originally Posted by SPDKLZ

Maybe its just me... But failing to redesign a vehicle after 13 years kinda hangs it out to dry as far as sales go. I dont know where they would take the design and I wont say that I could do any better. But come on. 13 years and no refresh?

Except that the military which is the big customer is the one who orders redesigns etc, the retail versions take the military one and make it civillian friendly. So why redesign a vehicle like this for less than 500 sales per year?

Guaranteed that if they did there would be all sorts of screaming on here about how GM is wasting money.

The H1 has one big problem, purchase price, you can buy a jeep and do all sorts of mods on it and still not even touch 40% of the H1 price, yet have a fairly decent competitor ability wise.

[camaro chris]

if they kill the H1, i may lose all faith in GM. its like killing the corvette if it doesnt sell well, its just something that should NEVER happen.