GM to Cut production on pickups

[ozpont]

GM to Make Fewer SUVs, Pickups As Sales Decline
By JEFF BENNETT
April 29, 2008;

      DETROIT -- General Motors Corp. said it will cut  production of heavy-duty pickup trucks and sport-utility vehicles by as much as 138,000 at four North American plants in the second half in reaction to declining sales as consumers shift to smaller, more fuel-efficient vehicles.

     The move will reduce by 88,000 the number of pickup trucks GM had planned to produce this year, and lower by 50,000 the number of SUVs it had planned to build, the company said in a statement. Production cuts hurt auto makers because they eat into the revenue the affected plants generate.

     These cuts come even though the auto maker's pickup-and-SUV production has been nearly paralyzed by a more than two-month strike at parts supplier American Axle & Manufacturing Holdings Inc.

     GM, which is set to report its first-quarter earnings Wednesday, has lost money three years in a row. Analysts expect it to post another loss this year. GMAC Financial Services, once a cash cow, is grappling with big losses in its home-mortgage unit.

     The company said it will cut one shift of production at the company's assembly plants in Flint and Pontiac, Mich., and Janesville, Wis., factory starting July 14. A shift will also be cut at the Oshawa, Ontario, plant on Sept. 8. The shift reductions will affect 3,500 workers.

     GM, the United Auto Workers and Canadian Auto Workers will discuss how to eliminate the jobs.
With fuel prices rising, the economy softening and demand for full-size trucks falling, "a significant adjustment was needed to align our production with market realities," said Troy Clarke, GM North America president. "This is a difficult move, but we remain committed to retaining and growing our leadership position in the full-size truck market."