GM Says More ‘Creative Solutions’ Coming to Meet Demand

DETROIT – General Motors Co. will move to increase availability of its most popular vehicles over the coming weeks, the auto maker’s top executive in North America says.

“We’ve come up with some things that aren’t really publicized, really creative solutions,” GMNA President Mark Reuss tells a group of 450 fleet and commercial customers here.

“You’re going to start seeing some of these things here in the next two months,” he says. “We’re making those calls very rapidly.”

The auto maker does not divulge details, but the executive tells the fleet and commercial group GM first examines ways to add hours to a production shift.

Of GM’s 16 North American assembly plants, four are operating on 3-shift production schedules: Fairfax, KS; Lansing Delta Twp, MI; Fort Wayne, IN; and CAMI Automotive Inc. in Ingersoll, ON, Canada.

However, Reuss also warns the auto maker will move deliberately when it comes to any production increase.

“We never want to be in a structural-cost footprint, (where) we have to change radically, he says. “Peoples’ lives go along with that. Blasting things out, putting in capacity… we’re going to be really careful where we do that.”

Excluding April sales results for its jettisoned brands, GM sales jumped 20% compared with like-2009.

Of the fleet and commercial buyers attending the event, a good number also operate retail dealerships across the country. And their message to Reuss is clear: We need product, especially popular models such as the Chevy Malibu, Camaro Equinox and Traverse, Buick LaCrosse and GMC Terrain.

GM North America President Mark Reuss.

Bill Bowen, general sales manager at Jack Maxton Chevrolet in Columbus, OH, says customers recently shopping for a new car or truck now want to purchase. “But they can’t see what they want to buy. Now they’re going out to the competition. We’d like to keep those customers.”

GM emerged from last year’s bankruptcy committed to letting consumer demand pull product out of its factories. Its previous entity would push it out to cover massive structural costs and then heavily discount to clear bloated inventories, a practice that contributed to its historic Chapter 11 filing.

According to Ward’s data, the auto maker’s inventory at the end of April numbered 429,042 light vehicles, down 41.2% from year-ago and up 0.7% from March. It currently has an average of 61 days’ supply, compared with 111 in like-2009 and 59 in March.

A number of key assembly plants now operate on three shifts. And in March, GM decided to build extra bodies for the Equinox cross/utility vehicle at its CAMI plant and ship them to nearby Oshawa for final assembly. The idea was to spur some 300 extra units of Equinox and Terrain production per day after CAMI’s output could not satisfy demand.

Stocks of the two vehicles stand at 23 and 26 days, respectively.

As of April 30, inventories of the Chevy Traverse, which comes out of Lansing Delta Twp., was at 39 days. Fairfax, which builds the Chevy Malibu and Buick LaCrosse, has moved days’ supply of those midsize cars to 58 and 54, respectively.

Reuss also reveals the auto maker will make compressed natural-gas and liquefied petroleum-gas versions of its Chevy Express and GMC Savanna fullsize vans available to fleet customers beginning later this year. GM will modify the vans’ gasoline-powered 6.0L V-8 to burn the alternative fuels.

Despite the hopes of many fleet and commercial customers, Reuss says the auto maker has no plans currently to re-enter the medium-duty truck business. GM exited the segment last year after failing to divest the operation, which Reuss says was plagued by an inability to offer a comprehensive model line.

“Never say never. I would love to play in that space, and we would love the dealers to make a lot of money in it, too,” he says. “But the way we had it structured, from an engineering and product-development standpoint was not good.”

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