GM adding mid-size vehicle to Hummer lineup

[PARAGON]

<Table>
<H2>GM adding mid-size vehicle to Hummer lineup</H2>
<H3></H3>
<H4>By JOHN PORRETTO, AP Auto Writer
Last Updated 5:33 pm PDT Wednesday,
October 20, 2004</H4>DETROIT (AP) - The manager of General Motors Corp.'s
hulking Hummer lineup says she hopes to make the brand "more approachable" with
a new midsize sport utility vehicle scheduled to go on sale next spring.


The Hummer H3 is slated to make its international debut next Wednesday at the
California International Auto Show in Anaheim.



By entering the midsize SUV segment, Hummer makes itself a player in a
vehicle category that accounts for 1.7 million sales annually, Hummer general
manager Susan Docherty said Wednesday at a briefing with automotive journalists.


For now, she said, the brand's bread-and-butter vehicle, the larger H2,
competes in a segment with about 160,000 annual sales.


"Up to this point, as a brand, we've been about $50,000-plus trucks," said
Docherty, who helped launch the luxury Escalade SUV at Cadillac before joining
Hummer. "In the mid-size utility segment, customers want a smaller package,
something that's more fuel efficient, something that's easier to park and that's
a little bit more approachable - thus the H3."


GM has not announced pricing for the H3, but some analysts say it's likely to
be between $30,000 and $35,000.


The H3 will join the H1 and H2 SUVs and H2 SUT, which went on sale in June
and has features of both a large pickup and an SUV. The H1's price starts at
about $105,000 and the H2 and H2 SUT at roughly $50,000.


Hummer also has plans for a low-volume, high-performance series of vehicles
dubbed Alpha. It will begin with the 2006 H1 Alpha, which is scheduled for
launch in early 2005.


Docherty said the H3 will get about 20 miles per gallon on the highway - far
better than the other vehicles in the lineup. She acknowledged that $2-a-gallon
gasoline wasn't ideal for selling larger vehicles, but she said most people who
buy Hummers are less sensitive about gas prices than people shopping for smaller
cars or trucks.


Hummers are considered a status symbol for many Americans and have attracted
celebrities and athletes who aren't bothered by the steep sticker prices and low
gas mileage. The H2 was introduced in 2002, and even a growing SUV backlash and
increasing concern about U.S. dependence on foreign oil did little to stem
enthusiasm - and sales.


But business of late has fallen off, something Docherty said was not
unexpected in the third year of the product cycle. For the first nine months of
2004, Hummer sold 20,284 vehicles in the United States, down nearly 21 percent
from the 25,453 sold in the same period a year ago.


Art Spinella, president of CNW Marketing Research in Bandon, Ore., said part
of the problem for Hummer is many of the limited number of buyers who want one
already own one.


He said the H3 is likely to have a positive reception when it hits showrooms
next year, but it could see demand drop off considerably after six months or so,
after everyone waiting for the H3 buys one.


"There are a fair number of people who will look at a smaller Hummer,"
Spinella said. "But that segment saturates very quickly. Then you might have to
offer massive incentives to make the pool big enough to at least hit some sort
of sales target."</P></Table>

[PARAGON]

<Table>
<H2>GM adding mid-size vehicle to Hummer lineup</H2>
<H3></H3>
<H4>By JOHN PORRETTO, AP Auto Writer
Last Updated 5:33 pm PDT Wednesday,
October 20, 2004</H4>DETROIT (AP) - The manager of General Motors Corp.'s
hulking Hummer lineup says she hopes to make the brand "more approachable" with
a new midsize sport utility vehicle scheduled to go on sale next spring.


The Hummer H3 is slated to make its international debut next Wednesday at the
California International Auto Show in Anaheim.



By entering the midsize SUV segment, Hummer makes itself a player in a
vehicle category that accounts for 1.7 million sales annually, Hummer general
manager Susan Docherty said Wednesday at a briefing with automotive journalists.


For now, she said, the brand's bread-and-butter vehicle, the larger H2,
competes in a segment with about 160,000 annual sales.


"Up to this point, as a brand, we've been about $50,000-plus trucks," said
Docherty, who helped launch the luxury Escalade SUV at Cadillac before joining
Hummer. "In the mid-size utility segment, customers want a smaller package,
something that's more fuel efficient, something that's easier to park and that's
a little bit more approachable - thus the H3."


GM has not announced pricing for the H3, but some analysts say it's likely to
be between $30,000 and $35,000.


The H3 will join the H1 and H2 SUVs and H2 SUT, which went on sale in June
and has features of both a large pickup and an SUV. The H1's price starts at
about $105,000 and the H2 and H2 SUT at roughly $50,000.


Hummer also has plans for a low-volume, high-performance series of vehicles
dubbed Alpha. It will begin with the 2006 H1 Alpha, which is scheduled for
launch in early 2005.


Docherty said the H3 will get about 20 miles per gallon on the highway - far
better than the other vehicles in the lineup. She acknowledged that $2-a-gallon
gasoline wasn't ideal for selling larger vehicles, but she said most people who
buy Hummers are less sensitive about gas prices than people shopping for smaller
cars or trucks.


Hummers are considered a status symbol for many Americans and have attracted
celebrities and athletes who aren't bothered by the steep sticker prices and low
gas mileage. The H2 was introduced in 2002, and even a growing SUV backlash and
increasing concern about U.S. dependence on foreign oil did little to stem
enthusiasm - and sales.


But business of late has fallen off, something Docherty said was not
unexpected in the third year of the product cycle. For the first nine months of
2004, Hummer sold 20,284 vehicles in the United States, down nearly 21 percent
from the 25,453 sold in the same period a year ago.


Art Spinella, president of CNW Marketing Research in Bandon, Ore., said part
of the problem for Hummer is many of the limited number of buyers who want one
already own one.


He said the H3 is likely to have a positive reception when it hits showrooms
next year, but it could see demand drop off considerably after six months or so,
after everyone waiting for the H3 buys one.


"There are a fair number of people who will look at a smaller Hummer,"
Spinella said. "But that segment saturates very quickly. Then you might have to
offer massive incentives to make the pool big enough to at least hit some sort
of sales target."</P></Table>

[PARAGON]

<Table>
<H2>GM adding mid-size vehicle to Hummer lineup</H2>
<H3></H3>
<H4>By JOHN PORRETTO, AP Auto Writer
Last Updated 5:33 pm PDT Wednesday,
October 20, 2004</H4>DETROIT (AP) - The manager of General Motors Corp.'s
hulking Hummer lineup says she hopes to make the brand "more approachable" with
a new midsize sport utility vehicle scheduled to go on sale next spring.


The Hummer H3 is slated to make its international debut next Wednesday at the
California International Auto Show in Anaheim.



By entering the midsize SUV segment, Hummer makes itself a player in a
vehicle category that accounts for 1.7 million sales annually, Hummer general
manager Susan Docherty said Wednesday at a briefing with automotive journalists.


For now, she said, the brand's bread-and-butter vehicle, the larger H2,
competes in a segment with about 160,000 annual sales.


"Up to this point, as a brand, we've been about $50,000-plus trucks," said
Docherty, who helped launch the luxury Escalade SUV at Cadillac before joining
Hummer. "In the mid-size utility segment, customers want a smaller package,
something that's more fuel efficient, something that's easier to park and that's
a little bit more approachable - thus the H3."


GM has not announced pricing for the H3, but some analysts say it's likely to
be between $30,000 and $35,000.


The H3 will join the H1 and H2 SUVs and H2 SUT, which went on sale in June
and has features of both a large pickup and an SUV. The H1's price starts at
about $105,000 and the H2 and H2 SUT at roughly $50,000.


Hummer also has plans for a low-volume, high-performance series of vehicles
dubbed Alpha. It will begin with the 2006 H1 Alpha, which is scheduled for
launch in early 2005.


Docherty said the H3 will get about 20 miles per gallon on the highway - far
better than the other vehicles in the lineup. She acknowledged that $2-a-gallon
gasoline wasn't ideal for selling larger vehicles, but she said most people who
buy Hummers are less sensitive about gas prices than people shopping for smaller
cars or trucks.


Hummers are considered a status symbol for many Americans and have attracted
celebrities and athletes who aren't bothered by the steep sticker prices and low
gas mileage. The H2 was introduced in 2002, and even a growing SUV backlash and
increasing concern about U.S. dependence on foreign oil did little to stem
enthusiasm - and sales.


But business of late has fallen off, something Docherty said was not
unexpected in the third year of the product cycle. For the first nine months of
2004, Hummer sold 20,284 vehicles in the United States, down nearly 21 percent
from the 25,453 sold in the same period a year ago.


Art Spinella, president of CNW Marketing Research in Bandon, Ore., said part
of the problem for Hummer is many of the limited number of buyers who want one
already own one.


He said the H3 is likely to have a positive reception when it hits showrooms
next year, but it could see demand drop off considerably after six months or so,
after everyone waiting for the H3 buys one.


"There are a fair number of people who will look at a smaller Hummer,"
Spinella said. "But that segment saturates very quickly. Then you might have to
offer massive incentives to make the pool big enough to at least hit some sort
of sales target."</P></Table>

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<TABLE width="100%">
<TBODY>
<TR>
<TD vAlign=top><SPAN class=storytitle>2006 Hummer H3</SPAN>
</TD>
<TD vAlign=top align=right>
<TR>
<TD vAlign=top colSpan=2><SPAN class=storyblurb>To acquire a reputation on the
street, first get off it.</SPAN>
<SPAN class=author>BY JOHN PEARLEY
HUFFMAN</SPAN>
<SPAN class=photo>November
2004</SPAN>


Hummer is still a novelty brand. The mammoth H2 is the vehicle to buy if your
neighbor heads up the local Sierra Club chapter and you don't like him at
all. It sells more on its affectations than its abilities, but with sales
drooping, the novelty of those affectations is fading. The challenge for GM is
for Hummer to earn some street cred for genuine ability before launching the
next, smaller SUV—and it's expected to be the line's bestseller—so it can
confront Jeep head on. And the way to do that is to get as far away from the
street as possible.</P>


So they brought five prototypes of the 2006 Hummer H3 to northeast
California's spectacularly beautiful Rubicon Trail—Jeep's semiofficial proving
ground, namesake of the Wrangler Rubicon—and invited four automotive writers
along on a two-day development trek up the legendary granite-and-dust nonroad.
Both camping and seeing GM engineers without their shirts on were among the
program's unique features.</P><!--
-->


The five H3s were culled from a group of 78 "integration vehicles" built with
"production intent" parts and used for final tuning and safety testing (half of
the 78 were destroyed in barrier crashes). They're dang close to the production
H3s that will be in Hummer dealers' Quonset huts next summer wearing a base
price of about $30,000, even though the interiors lacked some trim and graining
on the plastic and the exteriors wore dorky camouflage. The four gray H3s varied
slightly in gearing and equipment, but all ran GM's 4L60-E four-speed automatic
transmission. The sole yellow H3 had a five-speed manual transmission.</P>


Derived from the Chevrolet Colorado and GMC Canyon pickups, the H3 shares
those trucks' body-on-frame construction; double-A-arm and torsion-bar front and
leaf-spring rear suspension systems; and 220-hp, 3.5-liter DOHC 20-valve
all-aluminum inline five-cylinder Vortec engine (the only engine offered).</P>


At 186.7 inches long, the H3 is 4.9 inches shorter than a GMC Envoy; its
111.9-inch wheelbase is only 1.1 inches shorter than that mid-size SUV's.
Compared with the H2, the H3 is 16.8 inches less lengthy overall and rides on a
wheelbase that is 10.9 inches shorter. The slab-sided H3 may superficially
resemble the old slab-sided 1984-to-2001 Jeep Cherokee, but it's 19.2 inches
longer. And although GM is still paring down the H3's heft, it weighs well over
two tons. This is a smaller Hummer, but it's not small.</P>


The H3's most important components on the Rubicon
were 33-inch-tall LT285/75R-16 Bridgestone Dueler A/T tires, part of the ZM6
Off-Road Adventure package carried by all five vehicles (base H3s will get
31-inch-tall P265/75R-16 Goodyears); the electronically controlled dual-range
transfer case; and the electronically engaged locking rear differential. As was
incessantly made clear to the engineers on hand, a locking front diff would also
be a boon for rock crawlers, but they'll have to learn to work with the
traction-control system instead.</P>


The Rubicon Trail is only about 11 or 12 miles long (depending on who's
measuring and route variations), starting in the western Sierra Nevada Mountains
and running to the western shore of Lake Tahoe. It's thoroughly rugged, and the
parts of it that don't require crawling over granite boulders usually include
crossing granite outcroppings. It's literally the standard against which other
off-road routes are measured.</P>


Starting at Wentworth Springs with tires running 20 pounds of inflation, we
immediately put the H3s in low range to begin the two-day crawl and stayed there
throughout the trip. With speeds rarely exceeding 5 mph, the H3s truly are adept
and nimble climbers. There's a lot of travel in the suspension, the approach
angles are generous, the steering is precise but doesn't buck much when pounding
into rocks, the five-cylinder engine's throttle is progressive just off idle,
and the four-wheel-drive and traction-control systems work seamlessly together
under most conditions. The structure of the H3 is impressively stiff, which is
particularly evident as the truck slides off rocks to slam down hard on the skid
plates with solid thunks and few
shudders.</P>


Even in its incomplete and unfinished state, the H3's five-passenger interior
is a big step forward from that of the H2 in that it's cleanly styled, with
straightforward controls, and lacks the H2's frippery and overwhelming
self-consciousness. The squat window line and long hood limit visibility a bit,
but on the Rubicon all that really matters is that you can see your spotter's
hands.</P>


For most Hummer buyers, off-road ability means something like easily trudging
out of the muddy parking lot at a horse show; that the H3 can conquer the
Rubicon is impressive, reassuring, and ego swelling but ultimately academic.
There's nothing on the Rubicon that simulates parallel parking, commuting along
I-5, or climbing the speed bumps at Target. In fact, the trail doesn't even
offer a chance to rev the H3's engine much beyond its torque peak of 225
pound-feet at 2800 rpm or get the transmission out of first gear. Nor can we
tell you how the truck rides on fully inflated tires.</P>


So the big test for the Hummer H3 still lies ahead when it confronts the
everyday world of its potential buyers, a world in which the appeal of overall
competence never fades.</P>Vehicle type: front-engine,
4-wheel-drive, 5-passenger, 5-door wagon</P>
Estimated base
price: $30,000</P>
Engine type: DOHC 20-valve inline-5, aluminum block and head, port fuel injection
Displacement: 211 cu in, 3464cc
Power (SAE net): 220 bhp @ 5600 rpm
Torque (SAE net): 225 lb-ft @ 2800 rpm
<DIV align=left>
<HR width=150>
</DIV>Transmissions: 5-speed manual,4-speed automatic
Wheelbase: 111.9 in
Length/width/height: 186.7/85.5/74.5 in
Curb weight: 4800 lb
C/D-estimated performance (4-sp auto):
Zero to 60 mph: 9.3 sec
Standing 1/4-mile: 16.9 sec
Projected fuel economy (mfr's est, 4-sp auto):
EPA city driving: 15 mpg
EPA highway driving: 18 mpg</TD></TR></TBODY></TABLE></TD></TR>

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