GM May Import "smart Killer" Matiz Mini to US

DETROIT, Jan 11, 2005; Michael Ellis writng for Reuters reported that General Motors Corp. eyeing the growing number of small cars coming to the U.S. market, is considering importing from Korea the Daewoo Matiz minicar built by its affiliate GM Daewoo, the head of GM Daewoo said on Tuesday.

The minicar, already sold as the Pontiac Matiz in Mexico, could appeal to buyers in big U.S. cities who have been smitten by fuel-saving cars like the Mini from Germany's BMW AG, said Nick Reilly, chief executive officer of GM Daewoo Automotive Technology Co.

"You go to places like New York or Los Angeles, these sorts of cities where people are concerned about parking spaces, about congestion, about fuel economy, emission and all these other things. It (the Matiz) sells extremely well in other parts of the world," Reilly told Reuters in an interview at the North American International Auto Show here.

Many other automakers have announced plans to add smaller cars to their lineup, including Nissan Motor Co. Ltd., Honda Motor Co. Ltd. and Volkswagen AG's Audi brand.

DaimlerChrysler orchestrated a parade of its tiny Smart cars through the streets of Detroit during the auto show this week, bringing attention to the brand.

DaimlerChrysler officials said they are considering bringing the European-built Smart cars to the U.S. market.

"Americans haven't been used to those types of cars, but if they see the Smart car and they see the Mini, it makes sense," Reilly said.

GM hasn't done a serious study yet on the business case for the Matiz, Reilly said. But he figures sales of at least 20,000 a year are needed to make it viable. GM could decide to import the Matiz as early as late 2005, he said.

GM's smallest car currently is the Chevrolet Aveo, also built in Korea by GM Daewoo. The hatchback version of the Aveo, the best-selling compact car on the U.S. market, is 153 inches long and the car gets up to 35 miles per gallon on the highway. Reilly expects North American sales of the Aveo to grow from 70,000 last year to as many as 100,000 this year.

GM, Japan's Suzuki Motor Corp. and Chinese automaker Shanghai Automotive bought some of the assets of bankrupt Daewoo Motors in 2002 to form GM Daewoo.

Reilly said that further sales growth should help the money-losing car company near profitability.

"We should be heading towards profitability given the volumes and, whether that happens this year or next year, I can't be certain," he said.

GM's share of the losses from its approximately 46 percent stake in GM Daewoo dwindled to $18 million in the first nine months of 2004, down from $50 million during the first nine months of 2003.