Lutz Says GM to Trim Costs and Could Stop Building Cars in USA, TACH Says: "What's Good For GM Could Become Good For China"

Washington DC October 12, 2005; The AIADA newsletter reported that General Motors Vice Chairman Bob Lutz on Tuesday announced plans to streamline engineering and production of new models and possibly build more autos overseas, in an effort to trim costs by $1 billion, reports Bloomberg News.

Beginning January 1, Lutz said the automaker will use a single engineering budget for vehicle development as opposed to four separate regional budgets.

Cuts will be made from “investment, material and manufacturing expenses,” according to the vice chairman. Lutz also alluded to further changes in its engineering operations, citing healthcare spending and Delphi’s bankruptcy as a challenge to maintaining engineering operations in the U.S. "If economic conditions are such that it becomes economically unfeasible to produce vehicles inside the United States as opposed to importing them from somewhere else, you’d be foolish to keep building," Lutz said while giving a speech in Detroit. "We don’t make that decision. The overall economic environment makes that decision."