CHICAGO -- Oldsmobile will drop its midsize Toronado luxury coupe and full-size Custom Cruiser station wagon after 1992, the first evidence that General Motors Corp. is about to whittle down its product offerings in order to cut costs and regain profitability for its North American operations.
Earlier this week GM announced it earned a scant $179 million in the first quarter of this year. Though that was GM's first profit in six quarters, the company said its North American operations were still losing money, with estimates of $1 billion or more for the quarter, and that consolidation and cost-cutting would be accelerated.
Elimination of selected models would appear to be the next step in GM's top-to-bottom reorganization.
That effort began last December, when GM Chairman Robert Stempel announced that 21 plants and 74,000 jobs would be eliminated by the end of 1995. On April 6, the company's outside directors moved to speed the change by demoting two of Mr. Stempel's top lieutenants and easing him out as head of the board's executive committee. Last week, Mr. Stempel announced a sweeping realignment of GM's automotive divisions and hinted that a review of its many product lines was under way.
Toronado is a well-known nameplate that raised some eyebrows when it was introduced in 1966 because it featured front-wheel drive. Sales have been poor in recent years. In 1985, Oldsmobile sold 37,581 Toronados; but in 1991, it sold only 8,600. It has sold only 2,750 in the 1992 model year to date and is headed for sales of only 4,500 units for the full year.
The Toronado, Riviera and Eldorado are built by Cadillac in the same plant outside Detroit. The Custom Cruiser has had equally poor sales of late. Sales totaled 15,000 in 1987 but sank to 6,300 in 1991. At the current rate, sales are expected to reach only 5,000 units for 1992. Oldsmobile said the Bravada utility vehicle and Silhouette mini-van have won over customers who had bought full-size, rear-wheel-drive wagons.
While Oldsmobile gives up one model, it will get another in return, a four-door luxury sedan for the 1993 model year that will be built at the same plant producing the Oldsmobile 98.