Cash crunch: GM delays spending

General Motors is postponing nearly all of its spending on product development in 2009 and 2010–a cost-cutting move that could delay the introduction of key vehicles such as the Chevrolet Cruze.

The automaker also is cutting spending on engineering, design and R&D, say sources familiar with GM's plans. So far, nothing has been officially canceled, but nearly everything is delayed, the sources say.

"The 2009 stuff that's too late to cancel is coming out, then everything else gets pushed out anywhere between three months and up to a year," said one of the sources. "It's not just capital budget; it's also engineering, design … everything that would cause money to flow out in 2009."

General Motors is taking drastic action to avoid running out of money sometime next year. With its product delays, GM hopes to save as much as $1.5 billion, said the source.

GM spokesman Dee Allen declined to comment on plans for individual products. "There have been all kinds of speculation," he said. "We've said we're reviewing our portfolio, and we do that as a regular course of business."

Two high-profile vehicles–the Chevrolet Camaro and the Chevrolet Volt plug-in hybrid–are protected from the cutbacks, says one source close to GM. Likewise, the restyled Buick LaCrosse, the Chevrolet Traverse and possibly the Cadillac CTS wagon are still due to market as planned. AutoWeek