GMI Exclusive: Kappa II Platform Axed From R&D

[nsap]

GMI Exclusive: Kappa II Platform Axed From R&D
The product plans continue to shuffle at GM.
www.gminsidenews.com
September 1, 2008

It is no secret by now that General Motors has been shaking up its product programs left and right. We first heard of the slashing of the Buick Zeta car, apparent death of the Cadillac Zeta car, and the impending death of a couple GMC product programs. Now GMI is hearing that the Kappa II program, successor to the current lineup of Kappa roadsters, has been pulled from the product plans. The reasons for all of these changes are obvious; uncertain gas prices, an uneasy economy, poor financial situation within the company and an overall product shake up are just a few reasons.

The Kappa line of products makes the "cut" bill rather easily. GMI has been told that when the Pontiac Solstice and Saturn Sky came to the market, GM was losing around $10,000 per unit built. Needless to say, that is not a money-making product line by any stretch of the imagination. It is not entirely surprising that Kappa has been a money pit of a product program. From the ground up Kappa cars are costly; starting with the frame no less. The Kappa architecture is hydroformed as part of the fabrication process to achieve the dimensions and frame rails needed. Many of the body panels (namely the hood, deck-lid, and fenders) are hydroformed as well. Hydra-forming is a costly fabrication method, particularly for vehicles that have such low starting prices and low volume to boot. Add on the fact that the Kappa vehicles are largely “hand built” cars (at least by today’s standards); it becomes quite evident why GM will likely never get a return on investment with the Kappa products.

There has been speculation throughout the last year that Kappa II would be a more usable platform, supposedly loosely based off of the quite-mainstream Zeta that underpins the new Camaro. Speculation has also arisen in recent years that the next-generation Kappa products would [have been] built at GM’s new plant in Mexico to help offset the staggering loss it has taken with Kappa. Apparently such plans have been scrapped as market conditions have since changed and Kappa II is off the table

What this obviously means is that the Pontiac Solstice, Saturn Sky, Daewoo SX2 and Opel GT roadsters are “once and done” products. All of these vehicles were introduced as “image cars” for their respective brands, which is how GM justified the losses on them. Possibly one generation of the Kappa’s was enough to boost their respective brand’s image?

As always, we want to add that product plans, particularly in today’s world at GM, change constantly. As of late last week though, the Kappa II program was shelved. That does not mean that GM may not open it up tomorrow, next month or a year from now. However, we suspect that unless the financial situation at GM changes dramatically soon, the Kappa II program will likely maintain its “shelved” status.

[FenwickHockey65]

Booo.
It was good while they lasted. Any word on what year the platform will be cut?

[nsap]

Originally Posted by FenwickHockey65

Booo.
It was good while they lasted. Any word on what year the platform will be cut?

The current generation of cars will run its full life, then they're done.

I'm not going to boo this one. I think this is a good move. If something HAS to be cut, it should be product lines like this...niche products that do not sell much and are money pits. Business wise this was a no-brainier.

[FenwickHockey65]

Originally Posted by nsap

The current generation of cars will run its full life, then they're done.

I'm not going to boo this one. I think this is a good move. If something HAS to be cut, it should be product lines like this...niche products that do not sell much and are money pits. Business wise this was a no-brainier.

Yeah, a good business move, but still sucks to see them go. They were good cars.
At least Alpha's still green lighted. Maybe we'll get something similar on that platform.

[paul8488]

Why did they build such an expensive platform for such low-volume vehicles? They should have done something that was A) more traditional and easy to build, and B) more flexible, to use with more vehicles (including those with a back seat). What could have been a wonderful small RWD platform that could have spawned all sort of cool cars (Nomad, a RWD G5, a Buick Velite even) has become a one-generation waste of money. Ah well, Solstice and Sky owners should be glad... their cars are about to become collectors items!

[kenman923]

That's it. Goodbye GM. My next car will either be a Honda Accord or a Mazda 6.

[nsap]

Originally Posted by kenman923

That's it. Goodbye GM. My next car will either be a Honda Accord or a Mazda 6.

If GM does not make cuts like the above, it would not matter of your opinion because chances are there would not be a GM for you to buy.

[Ming]

While it is sad to see it go, I agree with Paul. Considering that GM has had some success in near-stock racing with the Cobalt SS (Gran Am Cup ST Class), one has to wonder if a convertible based off of the Cobalt (with much more attractive styling) would have not accomplished almost the same thing -- instead of the expensive to produce Kappa platform.

[ChevyRules]

Originally Posted by nsap

If GM does not make cuts like the above, it would not matter of your opinion because chances are there would not be a GM for you to buy.

Agreed, it sucks that they are being killed. But, the car sold for $20K and they lost $10K per Kappa. That is a huge loss and was being subsidized by the huge truck and SUV sales. Now they lost the truck and SUV's sales which makes the hit even harder on GM. Plus, they will be producing the money pit that is called the Volt. They can't have two huge money pits and survive.

[kenman923]

Originally Posted by nsap

If GM does not make cuts like the above, it would not matter of your opinion because chances are there would not be a GM for you to buy.

The bottom line is that GM is not making cars that people want to buy. If they continue to cut everything, there will be not products that GM has to offer to stay in business.

[mkwelbornjr]

How do other companies make money on small/fun cars and roadsters? I dont see BMW cancelling the Z4's etc.

[HoosierRon]

Originally Posted by nsap

I'm not going to boo this one.

[samkung]

why cant gm use its kappa to make affordable small rwd cars for Pontiac and Holden? i mean other than the current 2 models, why not make some 1-series size cars?

[Ed Arcuri]

I'm a new Solstice owner and I'm not glad the KappaII program has been cut.
Here's hoping that GM will continue to build a small, affordable roadster on some platform.
I've only had the car two days and I can see a number of places it could have been made less expensively. I've also seen a few places GM could have improved the cars' desirability.
The shortcomings of the car don't bother me. I've had MG's, FIAT's, and Fiero's. The Solstice GXP is a world beater compared to those. The only sports car I've owned which I would compare favorably was a 1969 AMX; though the cars are greatly different and each appropriate for the time in which it was built.
Many people have asked me what kind of car I'm driving. When I tell them it's a Pontiac. the expression on their face tells me that they're reconsidering their whole conception of Pontiac. GM needs this kind of car.
Cheers,
Ed

[mkwelbornjr]

And how can Cadillac be the world standard without a well rounded RWD portfolio?