June 2007 Looking Ahead

Chevrolet is showed off its Malibu Hybrid at Major League Baseball’s 2007 All-Star game in San Francisco in anticipation of the vehicle’s October launch. Built with the same powertrain and platform as the Saturn Aura Green Line, the Malibu offers a modest 2 MPG improvement over the conventional 4-cylinder model, delivering fuel economy of 24 MPG city/32 MPG highway (27 MPG combined). Pricing has not been released, but if Chevy’s approach is similar to Saturn’s, the hybrid powertrain will add roughly $1,700 to the sticker price.

It’s hard to get excited about any of the GM hybrid models (including the Malibu) that use the Belt-Alternator Starter (BAS) system. In a market dominated by the Prius, the Malibu Hybrid’s fuel economy seems mediocre and its technology seems dated. It’s like showing your three-year-old Blackberry to a group of new iPhone owners: everyone recognizes that you’re trying, but you still don’t get much respect. Judging from the sales numbers, the market agrees with us: in its first three months on the market, the Saturn Aura Greenline has sold just 334 units.

How could GM invigorate sales of its first hybrids? The first step could be to drop the hybrid label from the Malibu and the Aura. Calling them hybrids encourages comparison with Toyota’s full-hybrid offerings, making GM look like a technology laggard. Labeling the Aura and Malibu as hybrids also will cause confusion when GM launches new models that use its own "Two-Mode" full-hybrid system later this year. The Aura and Malibu are good cars that get respectable fuel economy at a reasonable price by using the BAS system. But they don’t fit well with many consumers’ notions of what a hybrid is, so put the marketing team to work and think up a new name to describe their powertrains.

Another more transformative shift in strategy is to make the BAS system standard equipment on all models across an entire brand. Compared with other hybrid systems, BAS is relatively affordable and is easy to package in existing vehicles. It may only deliver a 10% fuel economy gain, but a 10% gain across a whole vehicle lineup is something GM could brag about. Not many Saturn customers are shelling out $1,700 for the hybrid version of the Aura, but our bet is many buyers would be interested in higher fuel economy if it caused only a slight increase in sticker price and was made to be synonymous with the Saturn brand.