Washington  - Amidst the onslaught of surging fuel prices, General Motors, the world's largest automotive manufacturer, has stopped a project to overhaul its gas-guzzling fleet of sport utility vehicles and trucks, the company said.

Instead, the company will focus on developing cars that promise improved fuel economy, Bloomberg financial news service reported Thursday.

Trucks account for more than 60 percent of GM's annual US sales and generate more profit than cars, and the move was called "hugely significant" by one analyst.

"This is a clear sign they are re-evaluating everything, because this has been the core of their bottom line for years," Rebecca Lindland, an analyst for Global Insight Inc in Lexington, Massachusetts, was quoted as saying.

Engineers who had been assigned to overhaul such models as the Chevrolet Tahoe SUV and Silverado pickup for 2012 are being transferred to other projects, Tom Pyden, a spokesman for Detroit- based GM, was quoted as saying late Wednesday.

The shift is the second change this month for GM as gasoline tops 4 dollars a gallon - or 1 dollar a litre.

Earlier this month, chief executive officer Rick Wagoner said he would close four factories that build the large vehicles by 2010.

GM reported a 37 per-cent plunge in May US sales of pickups, SUVs and vans. (dpa)