General Motors Corp said on Monday it would cut truck production at four North American plants in the coming quarter because of weaker demand for its full-size pickup trucks and sport utility vehicles.
GM said it would eliminate one shift of planned production at each of the plants between July and September, cutting 138,000 light trucks from GM’s planned output for the year.
The Detroit-based automaker said it would negotiate layoffs prompted by the reduced production schedule with the United Auto Workers and Canadian Auto Workers unions.
The GM plants affected by the production cuts are in Pontiac and Flint, Michigan; Oshawa, Ontario; and Janesville, Wisconsin. All four plants had been at least partly idled by a two-month-old strike against GM supplier American Axle & Manufacturing Holdings Inc .
GM’s move would make permanent much of the production it has lost because of the UAW strike against American Axle, a former GM unit that supplies parts for SUVs like the Chevrolet Tahoe and pickup trucks like the Chevrolet Silverado.
“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,” Troy Clarke, president of GM North America, said in a statement.
GM said industry-wide sales of full-size pickup trucks in the United States were down 15 percent in the first quarter while full-size SUV sales were off 26 percent.
Clarke said GM was exploring “options” to expand production of faster-selling cars and crossover vehicles like the Chevrolet Malibu and Buick Enclave but said there was no plan yet to make such a shift.
CAW President Buzz Hargrove told reporters his union had been notified of the planned GM production cut.
GM has shut down or partly shut down about 30 North American plants due to parts shortages from the UAW strike against American Axle.
The parts supplier, a former GM subsidiary, has demanded a sharp cut in wages and threatened to shift production from its plants in Michigan and New York to Mexico in the absence of union concessions.
Separately, GM has faced strike threats at a number of its U.S. plants because of unresolved contract terms with UAW local bargaining units.
UAW workers at a GM plant near Lansing, Michigan that makes the automaker’s line of crossover vehicles went on strike April 17 because of stalled local contract talks.
The work stoppages and planned production cuts come amid a slump in first-quarter U.S. vehicle sales that has run deeper than most automakers had expected heading into 2008.
For the first quarter, sales of light trucks and passenger cars were down 8 percent in the U.S. market compared with a year earlier for the industry as a whole.
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