GM cutting production, plans more layoffs

GM will attempt to avoid the same fate as Toyota and reduce production at a number of its plants to prevent an oversupply of vehicles in the stagnant U.S. market. Corroborating with the decline in demand for fullsize SUVs and pickups, GM confirmed today that it will start eliminating shifts at its Pontiac and Flint plants in Michigan as well as its Oshawa, Ontario, and Janesville, Wisconsin, sites to bring production capacity in line with market demand.



Under this plan, approximately 88,000 units of fullsize pickup and 50,000 units of full-size SUV production will be removed from GM's North American production capacity for the remainder of the 2008 calendar year. The vehicles include the Chevrolet Silverado, Suburban and Tahoe and the GMC Sierra and Yukon lines.

The fullsize pickup truck and fullsize SUV segments have softened for the entire industry – down 15 and 26%, respectively, through the first quarter of 2008. The production cuts will unfortunately result in lower staffing requirements at all four plants, and those details will be worked out over the next several weeks with union officials.