GM sets compact Cruze?s price at $16,995
 

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Those inclined to “buy Ohio” will be able to pick up a Lordstown-built Chevrolet Cruze this September with a sticker price starting at $16,995, General Motors said yesterday.

At that price, the Cruze, which replaces the Chevrolet Cobalt, will cost about $500 more than a Honda Civic, but GM contends that its car is the better value.

The company’s announcement yesterday included a side-by-side comparison, showing that the Cruze has nine standard features that cost extra on the Civic, including air conditioning, traction control and satellite radio.

“While some of our competitors may have a lower starting price, Cruze wins on value once these competitors are optioned up,” said Jim Campbell, GM’s vice president for marketing, in a statement.

Christina Ra, a Honda spokeswoman, said the comparison isn’t very useful because it uses a basic version of the Civic, without some of the most popular add-ons. Also, she sees little crossover between a potential Civic buyer and a Cruze buyer.

“The target customer may be very different,” she said.

Built at the Lordstown Assembly Plant near Youngstown, the Cruze is GM’s attempt to establish a presence among compact vehicles. In addition to the Civic, the segment includes the Ford Focus and Toyota Corolla.

Ohio leaders have a lot riding on the Cruze, which they hope will mark a turnaround for GM’s fortunes in the state, after a long period of layoffs and plant closings. Lordstown was spared in last year’s closings partly because of the investment that had been made in developing the Cruze.

The model already has been introduced in international markets, with about 200,000 vehicles sold. GM had hoped to begin U.S. sales sooner, but there have been delays on the engineering side.

John Wolkonowicz, auto analyst at IHS Global Insight, says the Cruze is one of the most important new products for U.S.-owned automakers in the next year. The others include the redesigned Focus compact and Fiesta subcompact from Ford and the Chevrolet Aveo subcompact.

The four models take aim at parts of the market that have been dominated by foreign-based automakers.

“This is going to put some pricing pressure on the Japanese companies,” Wolkonowicz said.

His main concern about the Cruze is that its styling might be too bland, especially compared with the new Focus.

“The Cruze is a lot more conservative than the Focus,” he said. “That’s not by design, but that’s how it turned out.”

His company is forecasting that the Cruze will sell 169,000 units next year and increase to 180,000 a year by 2013.

Those numbers would be lower than those for the Cobalt, 212,000 of which were sold in 2006.

Wolkonowicz said GM made almost no profit on the Cobalt, but the Cruze is expected to be more of a moneymaker.



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