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2011 Chevy Cruze will cost more than rivals, says GM

Siddarth Raja

20 16,021 views Sep 16, 2008

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GM's upcoming global small car, the 2011 Chevrolet Cruze, already has the weight of the company's hopes on its shoulders, but news that GM is now planning to sell the Chevrolet Cruze for a higher price than similar cars offered by Japanese competitors Honda and Toyota threatens to weaken anticipation for the highly-efficient small sedan before it even hits the streets. Already the Cruze has been pitched as the new savior of GM, even more so than the Volt, since the just-revealed plug-in electric won't be a real source of profit for the company for several years.

Along the same lines, GM executives cited the need to improve profit margins on the small car as the reason for the relatively high price. Small cars traditionally have been sold as volume cars with low profit margins, while any money lost in keeping its volumes up could be regained through profits on SUV and truck sales, but that model has now collapsed with the SUV and pickup market. One upside, however, to the SUV's fall from grace is that manfuacturers are finding it easier to sell premium small cars.

While pricing for the Cruze is still under wraps, car prices on the whole are increasing due to new features being offered - which in the Cruze includes more interior space, better fuel economy and some "unique content and materials," according to Chevrolet's General Manager, Ed Peper, reports MSNBC.

Edmunds reports that currently car purchasers pay an average of $19,184 for a Honda Civic and $18,232 for a Toyota Corolla, both in similar segments to the upcoming Cruze. Whether or not the Cruze's price will come under $20,000 is still uncertain, however it will certainly get close to this important psychological barrier when it arrives in 2010. Tipping over that hurdle may mean customers won't be as willing to cross-shop the Cruze with its Japanese rivals, and it's not likely that the GM car will carry the cachet necessary to compete with premium small-sedan offerings from the more luxury-oriented brands, potentially leaving it in a marketing no-mans land.

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Comments (20)

griffin lauerman Posted: 9/16/2008 4:06pm PDT

It the typical ugly American car. No style and no flair. Snore. I think I'll keep my Honda.

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Laz Posted: 9/16/2008 4:38pm PDT

I just hope GM doesn't pimp this car out to the rental car company giving it a zero resall value!

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George Posted: 9/16/2008 4:43pm PDT

No style or flair? Are you serious? Look at a Corolla, find me some style and flair. Economy cars never really looked all that great. Only now are manufacturers making some good looking automobiles.

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DougeTX Posted: 9/16/2008 5:34pm PDT

GM is definitely taking a gamble in charging more than the imports. Chevrolet has marketed itself as a value-based brand. They should have a low-priced model with the powertrain out of the Cobalt, and keep the turbo 1.4 for the LT trim level and focus their profit on that. If they can offer a model priced the same as Kia and Hyundai (which, honestly, are their closest competitors now with the devaluing of the brand), and sell the improved quality, they will do well with the Cruze. And they should stick with a name - look at Ford's Five Hundred/Taurus debaucle!!

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NoNameDenton Posted: 9/16/2008 5:36pm PDT

griffin lauerman, what are you somking, this is better then a Honda or Toyota. Anyways, they need to keep the price competitive, and bring us the diesel.

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Gus Posted: 9/16/2008 5:50pm PDT

That's what I was thinking, that it is much better looking than the imports.
I think griffin just wants to make sure we all know how much he likes his Honda...

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griffin lauerman Posted: 9/16/2008 7:21pm PDT

That's right, My Honda isn't flashy but at least it starts everyday and the resale won't drop into the toilet. Can you say that about most American cars...NO!

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amac Posted: 9/16/2008 7:41pm PDT

What a hatchet face.

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amac Posted: 9/16/2008 7:44pm PDT

It's better upside down though.

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NoNameDenton Posted: 9/16/2008 9:03pm PDT

griffin lauerman, what century do you live in, in the 21st century, American cars are now matching the Japanese on quality, so that argument no longer works, m'kay?

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Guber Posted: 9/16/2008 9:19pm PDT

GM are out of their collective minds, they are losing wads of money and customers to imports, and their plan is to charge more? sorta like our government, raise tax when its un-necessary to fatten their pockets! People who are shopping for these car in this segment are looking for value, reliability, re-sale, none of which, GM possess.

My prediction, it will flop, and GM will apply the "Employee discount" year round. Dealers will sell below invoice just to rid of it.

I've owned 2 american cars (Ford), they were both more reliable than the european cars that ive owned (Jag / 2 BMWs), but neither comes close to reliability as my Toyota, Honda(s) and Lexus. BMW was a fun car, nearly empty my wallet though, would have been great had it been reliable.

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Danny Posted: 9/16/2008 10:24pm PDT

If Cruze is offered with base and then available up to premium trim level, that might be a better marketing approach. Although small cars unfortunately do not yield high profit, they should try to price them competitively. Yea I think they should stick with a model name.

In terms of resale not a big factor, unless of course you go through many vehicles. I keep my vehicles as long as possible, until totaled or any repairs made does not extend the life of the vehicle.

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theChevyGuy Posted: 9/10/2009 2:27pm PDT

Cost is all relative. For a sporty car with both great gas mileage and a deluxe interior, this car is a bargain. Americans have been waiting for a car that offers a sports car look and feel that gets great gas mileage at an affordable price. Now they have one in the new Chevy Cruze. For more details visit: http://www.2011-Chevy-Cruze.com

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Salea28 Posted: 11/12/2009 12:22am PST

I think that chevy should keep the price competitive as well, the market does not seem to understand that the lower the costs, the more people will buy, GM is tryna save their behinds, and if they were smart they would keep the price for the cruz under 20,000. If it goes above that im not buying it. Use this as an example, im a college student looking for a car, and i think this car is adorable, simple yet "IN," if it goes up to even 19,000 im not getting it...so just think GM of all those who agree with me..

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DD Posted: 12/8/2009 11:22am PST

This should be a good car. The style is a specific from person to person. I own the Toyota now, the only reason I got it is MPG. If I can get Cruze with 6 speed manual transmission for 17K-18K I will change it.
By the way, as an owner of toyota corolla 2006 I can say I do not like it much. Bought it only because of MPG.

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By E Posted: 2/17/2010 7:33am PST

We've been driving a SUV, now thinking to buy a small car for daily short travels. The Cruz is really a good looking car to me and I would like to wait for it. Just hoping it won't be too expensive.

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DaughterofaMechanic Posted: 3/12/2010 2:57pm PST

I certainly hope this car can bring GM out of its funk however, a few additional comments. (1) Anyone who says American made vehicles are crap and don't work obviously doesn't know how to care for their vehicle. I learned quite a long time ago that brand and location of manufacture do not determine how long ones car lasts, its the person driving it that determines how long a car lasts. If a person regularly changes their oil and maintains their vehicle there will be no problems. My stepfather currently drives an 1986 Olds that was purchased new and has over 300K miles on it...it still starts in the morning during snow season with -20 windchill and never sits in the garage. (2) Name changing: If the Cruze is basically a Cobalt and a Cobalt is basically a Cavalier, what's the point in changing the name. You can fool some people, but not all. (3) Price, why pay more for something that is smaller? Logic would say that to remain competitive, you price competitive right? At the point GM charges more for the Cruze than the comparable Honda Civic or Toyota Corolla, they should just give up and start handing money to the import companies because that's what they're doing, they're letting their money go to someone else.

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chevy fan Posted: 4/13/2010 11:05am PDT

Wow. Only a few people here bother to think. The cost is going to be a bit higher because of the features and the higher MPG. I've been a chevy/GM guy my whole life. And with good reason. They've all been dang good to me. Only reason I've ever gotten rid of them? Rear-ended in two of them, and the other was just getting old and I wanted something new. No major repairs in any of them. I've had my Malibu for 4 years now, and have only had to do oil changes and brakes. It's got 75k miles on it now.
I've worked in auto shops and can honestly say those who say American cars don't have the reliability are full of it. Every manufacturer has its own glitches in it's cars. Honda front supsensions are nearly junk. Toyota engine and tranny mounts wear way too early. Lexus aren't reliable at all and are EXPENSIVE to fix. Others are just a pain to fix, which drives up labor costs in repairs. I plan on buying either a Volt or a Cruze Eco when my son inherits my mailibu in a few years.

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Nate Hamilton Posted: 4/22/2010 7:13am PDT

You do that griffin and continue to harm the American economy. Not only are you naive, but you're also a cretin my friend.

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Ps Posted: 6/29/2010 6:49pm PDT

German cars - you feel the quality - then come the repair bills and then come some more.
Japanese - reliable but boring. Really. Good values. They do have problems. My new Honda civic had more interior rattles than any car I've ever owned.
Now have my second new GM. Had a g6. Was a very solid car; better in every respect than the civic. I felt like I was taking a chance. I was surprised. A used g6 is a great buy.

Bought a new Malibu- now with 20k miles. It's as tight as the day off the lot. Smooth quiet, 30 mpg on highway, good power and handling, great seats and ergonomics. Many many subtle but nice features: radio (very good) adjusts to changing ambient noises, standard electric seat height adjustment, great adjustable lumber support, laminated windows for very quiet interior, great materials -- I've not had a single issue.
I think it's time to realize gm and ford are on par and sometimes even better than other makes
Think the press is beginning to give them what they've finally earned - respect. I do think the press has cut Toyota a BIG break. If ford or gm had the kind of accelerator problems resulting in multiple deaths -- we'd still be hearing about it -- what does that tell you -- the press is conditioned to automatically be biased against American brands.
Be open minded!

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