February 19, 2004

By JOHN PORRETTO / Associated Press

DETROIT – General Motors Corp. has notified Chevrolet dealers to stop selling the recently launched Aveo, the automaker's new Korean-made entry-level car, a spokesman said Thursday.

GM spokesman Jim Schell, who handles recall and product-safety communications, confirmed the company had issued a "stop delivery" notice to dealers, but he couldn't elaborate on the notification.

"Obviously, the dealers are honoring that," Schell told The Associated Press. "Any more information would be partial."

GM Chevrolet Aveo 4-door sedan

GM, the world's largest automaker, has had three recalls this month involving more than 2.5 million vehicles.

The Aveo has been on sale in North America for only a few months. GM reported 1,559 Aveo sales in the United States in January.

With a starting price of $10,000, Aveo is designed to give GM a player in a highly competitive segment that includes the Hyundai Accent, Kia Rio and Toyota Echo. Auto executives and analysts say low-priced offerings are important because they often are a consumer's first experience with an automaker.

The Aveo, available as a four-door or five-door sedan, is built overseas by a venture called GM Daewoo Automotive & Technology Co.

GM had said it expected to sell between 50,000 and 70,000 Aveos annually, which would place it near the top of the segment with the Accent and Rio.