Brisk Demand Spurs Malibu Production at Orion

A better-than-expected sales month and the addition of a second production site for the ’08 Chevrolet Malibu indicates the market is responding to the extensively redesigned sedan.

GM’s Fairfax, KS, assembly plant serves as the primary manufacturing location for the vehicle. Although executives revealed in an Oct. 2 sales call that Orion Township, MI, would receive demand-based production of the redesigned sedan, the auto maker stopped short of officially naming it as a second site.

GM now confirms production in Orion following a celebration at the plant marking the occasion.

A GM spokesman tells Ward’s the plant should begin shipping to dealers this week.

The spokesman says GM established a “flex-link” between the two plants, allowing it to dial Malibu production up and down “like a spigot,” depending on demand.

Fairfax, which also builds the Saturn Aura, currently operates two shifts building roughly 48 vehicles per hour. Orion, which also builds the Pontiac G6 family of vehicles, presently runs two shifts at 60 vehicles an hour. Those hourly rates would mean Fairfax builds about 700 units per day and Orion cranks out 900.

GM does not make production numbers available by model, but according to Ward’s data Fairfax averaged 262 Malibu units per day in October. Ward’s forecasts Orion will build roughly 144 Malibus per day in December, a month shortened to 15 production days due to the holiday shutdown.

Orion Township, MI, employees celebrate production of ’08 Chevy Malibu.

Perhaps more importantly, the Malibu launch at Orion suggests consumers are receiving the vehicle as well as most media critics.

GM officials say the car enjoys a turn rate of about seven days, a brisk pace fueled by a combination of its favorable reception and limited availability. Turnover is even quicker on the West Coast, where a Malibu sits on a dealer lot for roughly six days before being sold.

Scott Daly, sales manager at Courtesy Chevrolet in Phoenix, AZ, calls the reception excellent. “We can’t keep them on the lot,” he says.

“It’s a winner,” agrees Hank Gaylor, sales manager at Classic Chevrolet in Grapevine, TX. “We need more.”

Mark LaNeve, vice president-sales, service and marketing at GM, says the new Malibu drove a 15.0% increase in Chevrolet passenger-car sales in November – the sedan’s first full sales month.

“We thought we would sell 1,000 units, and we actually sold 3,994,” LaNeve says during a sales call with analysts and journalists.

GM hopes the ’08 Malibu will provide a more solid entry into the highly competitive midsize passenger-car segment dominated by the Toyota Camry and Honda Accord. Early anecdotal evidence suggests Malibu is winning conquest sales, LaNeve says.

“There’s a lot of good stories,” he says. “Dealers tell us, ‘You wouldn’t believe who is buying them.’ We think we’ve got a legitimate contender.

“We’ve said all along (the) perfect Camry and Accord customer who buys five in a row is not our target,” he adds. “But the customers who buy (a Camry or Accord) that are indifferent, we think we’ve got a shot at those.”

GM has gone to unusual lengths to hype the Malibu on the Internet and television before its launch.

The auto maker declines to reveal its advertising budget for the ’08 Malibu but estimates it at about what was spent to launch the redesigned version of its bread-and-butter Chevy Silverado fullsize pickup last year.

Malibu production marks the first Chevrolet product for the Orion plant, which celebrates its 25th anniversary next year. Throughout that time, Orion has built products for the Pontiac, Cadillac, Oldsmobile and Buick brands. The plant employs 2,059 hourly workers and 189 salaried personnel.