Trucks like the Chevrolet Silverado 1500 and GMC Sierra 1500 are some of GM’s most profitable vehicles, and following the extreme downturn in Q2 sales during the Coronavirus shutdown, they need to lean on that more than ever. But the UAW GM strike last fall already lowered inventory, and having factories closed during the Coronavirus pandemic shutdowns didn’t help the situation. To combat this, The Detroit News is reporting that General Motors is increasing its half-ton pickup truck truck production at the Fort Wayne, Indiana, plant.
GM dealers like about 90 days worth of truck inventory, and they’re not at that level currently while demand is resuming some normalcy. The Detroit News cites data from Cox Automotive, which says Chevrolet Silverado and GMC Sierra inventory combined is at 56 days. This is very low in comparison to Ford F-150 and Ram 1500 inventory (89 and 76 days, respectively), especially considering those brands are only accounting for one model compared to GM’s two.
GM executives confirmed production is increasing to fight the shortages and satisfy increasing demand, and that’s hardly a bad thing for GM to have to do. Employees will be added to the factory, possibly from the Tennessee Spring Hill Factory that builds the Cadillac XT5, XT6, and GMC Acadia. Demand is down for those crossovers, so much that they third shift was cut from the factory. It makes sense for GM to keep the unions happy by transferring employees to a factory with more demand rather than having layoffs. Still, it’s unclear how many additional jobs this will create.
But even when production is increased for GM trucks, they will still face challenges. Across all factories in America regardless of brand, worker absenteeism is a serious problem because of Coronavirus. That also extends to the smaller supplier factories that automaker outsource parts from. If you don’t have the parts to build the trucks, or the people to put them together, increasing production will do close to nothing.