I wouldn't go overreacting to this news too much. That said, I would not consider it "fasle" either.
Does GM lose money on these? Definately. Is it $10,000? That is more than figures I have heard. Regardless, when your running low on cash, programs that do not run in the black are the first to see cuts.
Does this mean the car is doomed? Definately not. First, they can continue to sell the current version relatively unchanged for the foreseeable future. Next, the investment in the coupe will mean that they will want to sell a few model years to help recover that investment.
Maybe this is the best way to look at it. GM is in some financial trouble, in large part due to the economic downturn as much as the lower truck sales (although both are partially tied together). Due to this trouble, GM has to focus it's resources on core projects and programs it cannot live without. The kappa's, although important for image (and damaging to image if cancelled), are not products essential for GM to survive as a corporation.
So GM shelves some of the redesign/continued development programs now. Sends that money to projects like the Volt, Cruze, and other core products. Then, if the economy rebounds in a year or two, and their bottom line gets better, they pull kappa2 off the shelf and hit the ground running.
That is the cup half full viewpoint anyway. GM could just pull the plug now, based on volume, profit, etc. Cut their losses. They are not. Instead, maybe they are willing to try and buy time by shelving the plans and soldiering on with the current car until their condition improves.
So although not great news, it is better than it could be too... and I think it is way too early to accept the fatalistic viewpoint of the article (that there will be now kappa after 2011).
