GM to Stop Making Sporty Fiero : Slow Sales Cited as Reason to End Production, Close Plant

From Reuters

General Motors said Tuesday that its Pontiac division will stop making the plastic-bodied Fiero sports car model at the end of the 1988 model year and shut the plant, idling 1,109 workers.

GM cited slow sales of the car for its decision to close the Pontiac, Mich., factory.

Production of the little two-seater will end in August. At that time, GM said, it would indefinitely idle the Fiero assembly plant, where 1,241 workers were already on layoff.

Pontiac general manager Michael Losh said GM decided to drop the car "based upon a realistic assessment" of the two-seater sports car market. He said there appeared to be no prospect for sales growth.

Analysts note that the car was first priced at $8,500, representing an inexpensive, sporty product. But the segment became overcrowded, and its current selling price of about $14,000 is out of reach for some customers.

In addition, Losh cited rising insurance rates that industry officials maintain are preventing many younger car buyers from purchasing sports cars.

The announcement followed GM's moves last week to boost production of other models at other sites, raising output by 185,000 units in the 1988 model year. It reopened a plant in Framingham, Mass., and recalled second shifts at three other plants. The actions surprised analysts because the industry is glutted with inventories.

The closing of the Fiero plant will be less of a shock to the industry. The Fiero, whose heavy use of plastic in side panels and other key parts of the car body was viewed by some as the wave of the future, suffered a sharp drop in popularity after a strong reception when it was introduced in 1983.

Sales figures show that in 1984, the first full sales year, Pontiac sold about 101,000 Fieros. But in 1987, sales dropped to 47,000 cars and in the 1988 model year, which began in October, 1987, only 9,600 Fieros have been sold.

Copyright © 2019, Los Angeles Times
EDITION: California | U.S. & World
77°