{"id":43685,"date":"2023-02-25T12:00:42","date_gmt":"2023-02-25T17:00:42","guid":{"rendered":"http:\/\/autosector.com\/?p=43685"},"modified":"2023-02-25T12:00:42","modified_gmt":"2023-02-25T17:00:42","slug":"gm-truck-production-cut","status":"publish","type":"post","link":"http:\/\/autosector.com\/?p=43685","title":{"rendered":"GM’s truck production cut signals a turn in U.S. auto sales – Autoblog"},"content":{"rendered":"

DETROIT \u2014 New vehicle sales in the United States are expected to increase in February, but the decision by General Motors<\/a> to cut production of large pickup trucks<\/a> at a U.S. plant points to new challenges for Detroit’s automakers.<\/p>\n

The major Detroit pickup truck brands are sitting on growing inventories of unsold vehicles, according to Cox Automotive data provided to Reuters.<\/p>\n

As supply-chain bottlenecks ease, the resolve among Detroit’s automakers to keep inventories tighter than before the pandemic will be tested. Automakers could have to choose between reducing output to avoid price cuts, or offering richer discounts to pump up sales volumes, dealers<\/a> said.<\/p>\n

GM dealers have over 100 days\u2019 supply of Chevy<\/a> Silverado pickups in stock, reflecting more vehicles on the ground and a seasonally slow pace of sales, according to Cox. Inventory levels are over 100 days\u2019 supply for rival Stellantis NV’s Ram half-ton and heavy-duty pickups. Ford<\/a> Motor Co has 92 days\u2019 worth of F-150s in stock, according to Cox data.<\/p>\n

A GM<\/a> spokesman said Cox\u2019s numbers do not accurately reflect GM\u2019s inventory situation. GM does not disclose detailed inventory figures. However, he said GM is acting to support its pricing strategy, which relies on keeping inventories leaner than in the past.<\/p>\n

Stellantis said in a statement it had no downtime planned at any of its North American plants, but constantly reviewed its inventory levels and would make production adjustments as needed.<\/p>\n

Industry consultants J.D. Power and LMC Automotive forecast on Friday that U.S.\u00a0car\u00a0<\/span>and light truck sales<\/a> for February would reach a 14.6 million-vehicle annualized pace. That is up from a year ago, but still well below pre-pandemic levels.<\/p>\n

February sales growth was led by a 54% increase in sales to fleet customers, Power and LMC said.<\/p>\n

Overall inventories of unsold vehicles are still low, but “are still not sufficient to fulfill demand each month,” Thomas King, president of the data and analytics division at J.D. Power, said in a statement.<\/p>\n

GM said its decision to idle the Fort Wayne, Indiana, assembly plant that builds Chevrolet<\/a> Silverado and GMC<\/a> Sierra pickup trucks for two weeks starting March 27 was done to maintain “optimal inventory levels with our dealerships<\/a>.”<\/p>\n

Who blinks first?<\/span><\/h2>\n

GM, Ford and Stellantis dominate the U.S. large pickup market, and for the past two years have been raising prices on their trucks<\/a> to record levels as supply-chain snags limited production.<\/p>\n

Dealers contacted by Reuters said that now, some customers are waiting for better deals, or are postponing purchases because the combination of high prices and higher interest rates put vehicles out of reach. The automakers face a choice between cutting prices using bigger rebates<\/a> or subsidized loans, or keeping inventories tight.<\/p>\n

“What they’re doing is playing what I call the blink game – whoever blinks first. Especially for trucks,” said Ohio dealer Rhett Ricar<\/span>t, whose Ricar<\/span>t Automotive Group sells Ford and GM trucks at different stores.<\/p>\n

Brad Sowers, president of Jim Butler Auto Group in Missouri, said high prices are hitting demand. However, he wrote in an email, “manufacturers do not want to flood the market and be forced to quadruple incentive spending to drive demand that will reduce their margins.”<\/p>\n

Some discounts are showing up in the large pickup segment. Ram is offering 2.9% financing for 72-month loans on certain Ram 1500<\/a> trucks.<\/p>\n

Power and LMC said fewer vehicles were sold in February above their manufacturer suggested prices, and that the average discount rose 4.7% to $1,335 a vehicle. That is still well below pre-pandemic levels, Power-LMC said.<\/p>\n","protected":false},"excerpt":{"rendered":"

DETROIT \u2014 New vehicle sales in the United States are expected to increase in February, but the decision by General Motors to cut production of large pickup trucks at a U.S. plant points to new challenges for Detroit’s automakers. The major Detroit pickup truck brands are sitting on growing inventories of unsold vehicles, according to […]<\/p>\n","protected":false},"author":1,"featured_media":43686,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[2],"tags":[],"class_list":["post-43685","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-industry"],"_links":{"self":[{"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/posts\/43685","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/autosector.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=43685"}],"version-history":[{"count":0,"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/posts\/43685\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/media\/43686"}],"wp:attachment":[{"href":"http:\/\/autosector.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=43685"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/autosector.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=43685"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/autosector.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=43685"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}