Federal loans could breathe new life into GM's RWD vehicles

Just this week the $25 billion federal loan package was approved for the car industry, and already insiders are hinting that the extra cash could revive plans for GM's rear-wheel drive Alpha platform. Movement toward more RWD models had been shelved on concerns over spending and efficiency regulations earlier this year, despite the large investments that had been made in that direction.

Bringing the Alpha platform back might help recuperate some of the R&D money that would otherwise have been lost on the project. If the reports prove true, GM won't just be barging forward with an outdated model of RWD excess, according to GM Inside News. Instead, they would be working to make the Alpha platform more flexible, so that it can accommodate a whole range of vehicles from compact coupe to full-size sedan. That's a smart business move in terms of maximizing the investment they've already made, despite the minor efficiency and cost issues of RWD designs when compared to easier-to-package FWD cars.

Last year, speculation about a possible RWD Pontiac G6 began to build, but the plan was later dashed on the grounds of cost and economy issues. A flexible Alpha platform vehicle may yet revive those hopes as well, however, since the G6 would be within the scope of vehicle sizes that are reportedly being considered. Similarly, the recently speculated end of the Kappa platform may see a migration to Alpha as well, meaning the Pontiac Solstice/Saturn Sky/Opel GT line of cars may yet live on as well.

The broadened Alpha platform would then replace the Zeta (Pontiac G8/Camaro/Holden Commodore) and Sigma (CTS) platforms with a single architecture. The economy of scale benefits to such a move are obvious, though nothing along those lines would happen until at least 2012 as GM completes its already planned production on those platforms. Already Cadillac has confirmed it is working on a smaller RWD four-cylinder car, which is expected to be based on the Alpha platform, though that does not necessarily mean anything for a wider RWD renaissance.

One factor that may work against the shift to Alpha is the Camaro. Just launched this year as a 2009 model, a complete platform shift by 2012 would be a very short product cycle, and short cycles generally mean greater expense - the opposite of the intended goal. But sacrificing one model's profit profile for the greater good of the company may make sense in terms of the broader bottom line. At any rate, such considerations underscore how speculative any such move away from the Zeta and Sigma platforms may be, and what is at stake.

With the looming CAFE standards in the U.S., tightening Euro emissions standards in the EU, and carbon trading schemes gearing up around the world, there is ample reason to explore alternatives in platform management, however. Embracing a single platform capable of playing host to an entire range of vehicles and equipped with everything from small turbo four-cylinders to full-size V8 engines could be the green alternative GM needs to meet its goals in a cost-effective manner, and that is, after all, the stated purpose for the $25 billion industry loan package.