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DETROIT – GM is on Cruze control.

General Motors introduced the Chevrolet Cruze terminal Oct as its respond to the Toyota Corolla and another diminutive automobile rivals. The timing couldn't hit been better. Gas prices hit risen nearly 50 proportionality since the automobile hit the U.S. market. And income of the Cruze worldwide are at 600,000, making it one of the most flourishing automobile launches in years.

It's the biggest warning of GM's strategy to build meliorate diminutive cars, a mart it ceded to the Asian for years. While trucks and SUVs ease provide such of its profit, GM is banking that higher fuel prices module drive customers toward diminutive models. The consort plans to start its prototypal machine Buick and the subcompact Chevrolet Sonic after in the year.

The strategy is display signs of stipendiary off. GM reported its prizewinning acquire in more than a decade on Thursday. As pedal prices marched toward $4 in the prototypal quarter, the Cruze and crossovers like the Chevy Equinox helped GM acquire $3.2 billion.

By contrast, it forfeited $4.4 1000000000 in the summer of 2008, when pedal prices terminal spiked over $4 and the consort had a worthless selection of cars with beatific pedal mileage.

Nearly half of GM's latest acquire came from commerce its wager in an machine parts company. But it ease prefabricated $1.7 1000000000 by offering fuel-efficient cars that people wanted to buy.

The Cruze was a big contributor, with income of more than 50,000 in the U.S. lonely during the quarter. Its worldwide income doubled. It gets meliorate distance than its predecessor at 36 mpg on the highway. It's farther quieter, handles meliorate and has a plusher interior than previous GM compacts and modify Asian competitors.

In March, those qualities helped it fortuity into the list of America's 20 top-selling vehicles. And its April income passed the Corolla, the best-selling machine for years.

Chief Executive Dan Akerson says GM's revenue in North USA chromatic 15 proportionality because of the Cruze and another fuel-efficient models. GM won't feature how such it makes on apiece car, but Akerson says customers are stipendiary $3,000 more for the Cruze than its predecessor, the Chevy Cobalt.

"Traditionally, they didn't attain money on diminutive cars, or some car. But it's a whole newborn world," says wife Lindland, an business analyst for the consulting concern IHS Automotive.

GM also prefabricated money on the Equinox and Terrain crossovers, SUV-like vehicles that are more economical because they're shapely on automobile platforms.

With front-wheel-drive and four-cylinder engines, they intend 32 mpg on the freeway. Their prime competitors, the Toyota RAV4, Honda CR-V and Hyundai Santa Fe intend 28, patch the Kia Sorento gets 29.

Customers want the models so seriously that GM doesn't hit to substance many discounts, something it had to do in time eld to sell diminutive vehicles.

Still, diminutive models sell for such inferior than restorative trucks and SUVs. Those income hit started to artefact as pedal continues to rise.

Joe Phillippi, chair of New Jersey-based AutoTrends Consulting LLC, says the acquire for diminutive cars and crossovers, modify models with bells and whistles, are only in the thousands of dollars. But loaded-out pickups and SUVs attain profits in the tens of thousands.

Investors vexation that GM's inventory of restorative trucks is likewise broad and it may be forced to substance big discounts, Phillippi says. The consort upraised restorative creation in the prototypal lodge but said it would adjust in the second lodge if income drop.

GM's stock toll lapse $1.07, or 3.2 percent, to $31.97 on Thursday.

GM also said it module improve container prices after in the assemblage to support cover increases in nakedness material costs. Last month GM upraised prices by an cipher of $123 per container to attain up for ascension lubricator and metal costs.

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