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GM says will shut 5 US plants in January to adjust supply

Tuesday, 20 Dec 2016 | 7:09 AM ET Reuters






General Motors will shut five U.S. auto assembly plants for varying durations in January, primarily to cut oversupply of sedans which have fallen out of favor among U.S. consumers.
GM confirmed on Monday information from sources at the United Auto Workers union who said that the five plants will shut.
GM had built up inventory recently and will be cutting back on that supply after the end of the current year. In October when it reported third-quarter earnings, GM said it has increased its U.S. dealer inventory by 111,000 vehicles.

GM at end-November had 84 days of U.S. supply of unsold new vehicles, up from 79 days at the end of October. GM said that days supply figure would "fluctuate before moderating at year-end."
A company spokesman said on Monday that it is targeting about 70 days of inventory.
Several Wall Street analysts, including Brian Johnson of Barclays, have said that if GM plants close to level out its inventory, it would pressure GM shares.
At about midday Monday, GM shares were down about 0.4 percent at $36.24.
Shut for three weeks will be the Detroit-Hamtramck plant in Michigan and the Fairfax factory in the Kansas. Down for two weeks will be the Lansing Grand River plant in Michigan, and down for a single week each will be the Lordstown plant in Ohio and the Bowling Green factory in Kentucky.
In November, GM announced the layoff of about 2,000 workers with the suspension of third shifts at the Lordstown and Lansing Grand River plants, also in January.
The Lordstown plant builds the compact Chevrolet Cruze, and the Lansing plant manufactures the Cadillac ATS and CTS. Sales of each of those models are down about a fifth from year-ago sales.
The January shutdowns were reported earlier by The Detroit News.



 

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Crossovers are the new craze! Little cars are a tough sell right now and even midsizers like the Camcord and Fusion are taking a hit in sales numbers.

The dealer I bought mine from now has over 100 Cruzens in stock! That's kinda ridiculous.
 

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Crossovers are the new craze! Little cars are a tough sell right now and even midsizers like the Camcord and Fusion are taking a hit in sales numbers.
This was the trend with autos well before this year and GM should have easily projected those ever increasing yearly losses. Probably doesn't help most salesman are not interested in selling you anything other than a Silverado or Tahoe and can't be bothered with learning about low profit cars features.

most dealers in my area have close to 100 Silverado on the lot, and usually less than 6 cruze.
 

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Lansing also makes the Camaro in Lansing in line with the CTS. This news sucks, they will shutdown normally this time of year, however it seems this is inventory inspired. Autoracks, trains that haul cars have been on the increase. This will effect my job directly, as I work for the biggest railroad, depends who you ask lol!
 

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We have 6 on our lot currently that haven't moved at all, including the hatch.
 
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Crossovers are the new craze! Little cars are a tough sell right now and even midsizers like the Camcord and Fusion are taking a hit in sales numbers.

The dealer I bought mine from now has over 100 Cruzens in stock! That's kinda ridiculous.
Yep, midsize sedans are having a tough time right now...except the Malibu. They are actually up, quite a bit, in sales, bucking the industry-wide trend.
 

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My Chevy dealer always has at least 100 cruzes in stock. Once fuel gets higher and it will eventually the price of big SUVs will drop and things get back to normal. The gen 2 Cruze I test drove Premier had a heated steering wheel, my dad's suburban that listed for 60k doesn't have that feature, I think if more people drove the Cruze and Malibu they would sell more of them, quite a value compared to other choices.

i think GM normally shuts down production for at least a week or so during the holidays, this is just extending that and makes sense.
 

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Yep, midsize sedans are having a tough time right now...except the Malibu. They are actually up, quite a bit, in sales, bucking the industry-wide trend.
Rental cars?

I kid...the new Bu is actually a pretty nice car for once! I drove a reasonably equipped 1.5T and was actually quite impressed with the driving dynamics, but somehow, the Cruze's interior looks/feels nicer on the LT models. Didn't look at a top trim, but I'm very impressed with the Cruze there.
 

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Rental cars?

I kid...the new Bu is actually a pretty nice car for once! I drove a reasonably equipped 1.5T and was actually quite impressed with the driving dynamics, but somehow, the Cruze's interior looks/feels nicer on the LT models. Didn't look at a top trim, but I'm very impressed with the Cruze there.
Until they start melting pistons:
Pretty common issue we are seeing.
 

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Cruzen inventory at the two largest Chevy dealers here has been growing over the last quarter. I can count on one hand the number of 2nd Gen. Cruze I've seen on the streets here and no hatchbacks either. Lots of 10th Gen. Civics on the streets, but no hatches yet, they are still on the lots in limited numbers. I think December's sales numbers are going to be pretty surprising.
 

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Civics have been out longer than the cruze has been also so you will see more. He mention the 1.5T in the video which only the Malibu has. The cruze has a 1.4t. I wondering if their see similar issues. I did just have a O2 sensor replaced on my cruze, check engine code was showing a emissions issue.
 

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GM should have easily projected those ever increasing yearly losses.
Once fuel gets higher and it will eventually the price of big SUVs will drop and things get back to normal.
I think the issue is trying to predict fuel prices. It's a game the Saudis are playing and we have no idea how long they will continue.


Yep, midsize sedans are having a tough time right now...except the Malibu. They are actually up, quite a bit, in sales, bucking the industry-wide trend.
Better back seat space?


Until they start melting pistons:
Ah, DanielJaegerFilms. I like the channel. He's got a series on failed turbos in the Cruze.

I do question his statement that he's seen a number of Cruzes doing it. The 2011, yeah. But different engine. Still, I have to wonder how much GM learned from the 2011 Cruze piston meltdown.
 
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Wonder who the piston supplier is?
 

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I'm curious to see how many Cruze Diesel orders will the dealers get...
My dealer was anti manual and anti Diesel since both were hard sales. When Premier wasn't a red tag sale and Malibu just didn't grab me I left. They had at least 15 premieres to include the one I was looking at in January and once again leaving Lordstown meet since Sunday was their grand opening.

They have like 84 new ones now...

New Chevrolet Cars for Sale | Chevy Dealer Cleveland, OH | Tim Lally Chevrolet
 
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