General Motors Is Closing Two Plants for Longer Summer Breaks
The biggest automaker in America, General Motors Company, is extending its summer factory shutdowns this year. At least two of the company’s factories will be closed for a longer period than usual, in order to scale back production.
General Motors will be closing its plant in Kansas City for five weeks this summer. There are also hints that the Kansas factory may face layoffs if vehicle sales don’t pick up after the summer break.
Another small General Motors factory—in Lordstown, Ohio—is expected to face a longer-than-usual summer downtime, of up to three weeks. The same factory has already experienced major job cuts.
The usual downtime at auto factories in the middle of summer is two weeks. These production breaks are often taken in order to prepare the factories for changes in the models of vehicles that are built there.
Both of these General Motors plants manufacture passenger cars. The factory in Kansas City manufactures the “Chevrolet Malibu” while the Lordstown plant manufactures the “Chevrolet Cruze.”
The extended shutdowns follow the American automaker facing a steep decline in demand for its passenger cars. Earlier this year, General Motors cut thousands of jobs for the same reason.
General Motors is now dealing with a glut of unsold cars. It is estimated that the company overproduced cars in the first half of 2017 when other automakers were scaling back production. The company’s unsold inventory in May was 44% higher compared to the same month last year. General Motors is now forced to cut back on output. (Source: Ibid.)
General Motors has seen a slowdown in sales in the first half of 2017. The company has particularly been experiencing a pullback in demand for its passenger cars, as American consumer tastes have shifted toward crossovers and semi-trucks.
“GM Extends Summer Break Amid Industry Slump, Growing Glut,” The Wall Street Journal, June 14, 2017.
“GM’s May sales fall on lower pickup truck demand,” MarketWatch, June 1, 2017.