GM to cut production of trucks, SUVs
In a tough market for trucks, GM is cutting back.
General Motors Corp. announced Monday that it would reduce production of light trucks and full-size SUVs in its U.S. and Canadian plants by 138,000, eliminating shifts at two Michigan plants, a plant in Wisconsin and a plant in Ontario, Canada.
Overall U.S. sales in the pickup and SUV category are slumping -- down 12.1% this year for all brands, and off 14.2% for GM. For GM, the top-selling automaker in the country, the cuts represent about 5.8% of its full-year production in the sector, which, excluding vans and medium- and heavy-duty trucks, reached 2.4 million last year.
“With rising fuel prices, a softening economy and a downward trend on current and future market demand for full-size trucks, a significant adjustment was needed to align our production with market realities,” said Troy Clark, GM’s head of North American operations.
GM said it would cut by 88,000 its production of full-size pickups, including the Chevy Silverado and GMC Sierra models. It will also cut full-size SUV production by 50,000, focusing on the Chevy Tahoe, Chevy Suburban and GMC Yukon models. The reductions are expected to lead to about 3,500 layoffs, but the company said it would not release exact numbers until later. The largest job losses are expected at its plant in Pontiac, Mich.
GM had already reduced production in part because of an ongoing strike at key supplier American Axle that has idled 31 GM plants.
Like most other automakers, GM is having a tough time of it in the early months of 2008. Overall, its sales were down 11% in the first quarter, and Wall Street analysts expect a loss of $1.54 a share when its first-quarter results are released Wednesday.
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