General Motors is once again slashing back pickup production in order to bring inventories in line with demand. New reports indicate the automaker is eliminating overtime shifts at a plant responsible for building heavy-duty variants of the Chevrolet Silverado and GMC Sierra.
Automotive News reports the company is scrapping five Saturday shifts originally scheduled for September and October. It’s a familiar move, seeing as GM’s truck plant in Fort Wayne, Indiana — which builds light-duty Silverados and Sierras — allegedly canceled similar shifts for the remainder of the year. It’s not the first move GM’s taken to adjust supply levels for the truck lines: earlier this summer, both plants were idled for two weeks to adapt to rising inventories at dealers nationwide.
These particular shifts were canceled “strictly to make sure that our inventory remains at the appropriate level, as opposed to producing too many vehicles,” Tom Wickham, a GM spokesman, told Automotive News.
June sales for GM’s pickups were up 15 percent overall compared with May figures, but the automaker’s supply was still at 122 days. Due to higher fuel prices and the weak economy, GM’s full-size truck sales have slowed, causing inventories to rise. July only saw an increase of two percent over June, but the supply of pickups fell to 115 days by the end of July. An 80-day supply is typical, according to analysts.
Don Johnson, GM’s vice president of sales, indicated that the automaker’s inventory was larger than the company preferred and that GM had been preparing for increased demand in the last half of the year. The third shift added this month at the Flint plant will remain, according to Wickham.
Production of the 2011 model year trucks has been discontinued and replaced by 2012 model year production. GM was trying to build enough 2012 model year trucks to maintain sufficient inventory for a future hiatus tied to re-tooling the plant for an all-new 2013 model.
Source: Automotive News (subscription required)