GM cuts SUV, truck output at 6 plants
General Motors said on Wednesday it has cut production at six plants that make large sport utility vehicles and pickups, citing fuel prices and competition in the market.
By Agencies |
DETROIT: General Motors said on Wednesday it has cut production at six plants that make large sport utility vehicles and pickups, citing fuel prices and competition in the market.
The largest US automaker did not specify how deep the production cuts were. But a General Motors spokesman Tom Wickham said that starting this past Monday, the company eliminated previously scheduled overtime production at plants in Arlington, Texas; Janesville, Wisconsin; Fort Wayne, Indiana; Flint, Michigan; Silao, Mexico; and Oshawa, Ontario.
The change will be in effect for the rest of the year. “Reducing overtime production enables us to reduce pressure for excessive incentive spending, helping us keep brand and product residual values as high as we can,” Wickham said. GM’s SUV and truck sales were down 9% in the first seven months of the year as housing starts slowed, high gas prices damped demand for bigger vehicles and competitors ramped up incentives.
Earlier this summer, Toyota Motor was offering incentives of just more than $5,000 per vehicle on its new full-size Tundra pickups, according to the auto research site Edmunds.com. GM responded by raising incentive spending in July.
Wickham said GM isn’t revising its production forecast at this time, but could announce changes when monthly sales results are released on September 4. General Motors plans to produce 1.075 million vehicles in Q3, including 697,500 trucks. That’s an increase of 2.2% over the third quarter of 2006. General Motors shares rose 25 cents to $31.33 in trading on Wednesday.
The largest US automaker did not specify how deep the production cuts were. But a General Motors spokesman Tom Wickham said that starting this past Monday, the company eliminated previously scheduled overtime production at plants in Arlington, Texas; Janesville, Wisconsin; Fort Wayne, Indiana; Flint, Michigan; Silao, Mexico; and Oshawa, Ontario.
The change will be in effect for the rest of the year. “Reducing overtime production enables us to reduce pressure for excessive incentive spending, helping us keep brand and product residual values as high as we can,” Wickham said. GM’s SUV and truck sales were down 9% in the first seven months of the year as housing starts slowed, high gas prices damped demand for bigger vehicles and competitors ramped up incentives.
Earlier this summer, Toyota Motor was offering incentives of just more than $5,000 per vehicle on its new full-size Tundra pickups, according to the auto research site Edmunds.com. GM responded by raising incentive spending in July.
Wickham said GM isn’t revising its production forecast at this time, but could announce changes when monthly sales results are released on September 4. General Motors plans to produce 1.075 million vehicles in Q3, including 697,500 trucks. That’s an increase of 2.2% over the third quarter of 2006. General Motors shares rose 25 cents to $31.33 in trading on Wednesday.
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