Full-size trucks may still be some of the most popular products General Motors currently sells, but a slowing sales pace and rising dealer inventories have prompted the automaker to idle two plants responsible for building both the GMC Sierra and Chevrolet Silverado.
Beginning July 4, GM will idle its plants in Flint, Michigan and Fort Wayne, Indiana for two weeks according to a report by Bloomberg. Over 5,000 employees are currently employed at both plants. The automaker also produces full-sized trucks at its factories in Arlington, Texas and Silao, Mexico, though no announcement has been made regarding the retooling of those locations. The closures will also ensure that GM isn’t stuck with an excess of amount of large truck inventory, which currently stands at 258,000, enough for a 110-day supply.
Though the price of gas has continued to decrease in recent weeks, the overall cost fluctuations have reflected negatively on the sales figures for GM’s full-size trucks. The Chevy Silverado, for example, was the brand’s best selling model last month, but experienced a 15.7 percent loss compared to May 2010; the GMC Sierra experienced a 4.9 decrease in sales. GM’s fuel-sipping small cars, however, have continued to shine. Chevrolet sold 22,711 Cruze sedans last month, while 4538 customers took home the Aveo subcompact (up 16.1 percent compared to May 2010).
Interestingly, GM says it doesn’t plan on running any incentives to help spur pickup sales. Instead, the automaker says it should be able to bring inventories of both the Silverado and Sierra in line simply by briefly halting assembly.
Source: Bloomberg, GM