GM cuts Sonic, Verano output to trim stockpiles

GM cuts Sonic, Verano output to trim stockpiles
Mike Colias
Automotive News | December 19, 2012 – 1:50 pm EST
UPDATED: 12/19/12 4:16 p.m. ET
DETROIT — General Motors has idled the Michigan plant that makes the Chevrolet Sonic and Buick Verano, one of several factories where shifts have been canceled as the company works to reduce high inventories.

Production was halted this week at GM’s Lake Orion assembly plant in suburban Detroit to adjust inventory, two people with knowledge of the schedule said. The plant’s roughly 1,800 workers are expected to return Jan. 2, after a scheduled holiday break next week, the sources said.

A GM spokesman said that the company doesn’t discuss its production schedules and that GM will “build to demand.”

Last week, GM North America President Mark Reuss acknowledged that GM has trimmed production to better align output with demand, though he didn’t specify models. He said GM’s sales were strong in the first half of the month and that inventories have declined.

GM’s U.S. sales have increased 4 percent to 2.35 million this year through November but trail the overall market’s 14 percent gain.

Last month GM sales executives said that adjusting production would be their first option to reduce vehicle stockpiles after the company’s U.S. inventory hit 788,200 units, or a 106-day supply, the highest level since April 2009.

The company also has canceled shifts at its Lordstown, Ohio, plant, where the Chevy Cruze is assembled; and at its Fairfax, Kan., plant, which makes the Chevy Malibu and Buick LaCrosse.

GM also has increased incentives this month to help clear dealership lots of excess inventory.

The Sonic and Verano — both nameplates that were launched in 2011 — have been bright spots for GM this year.

Through November, Sonic sales totaled 75,257, selling at a pace nearly double that of the car it replaced, the Aveo. GM has sold 36,222 Veranos, exceeding expectations of GM insiders and analysts.

As of Dec. 1, GM had an inventory of 25,700 Sonics, a 128-day supply, according to the Automotive News Data Center. Verano stocks stood at 14,900, a 104-day supply.

Last month, GM produced 7,988 Sonics and 5,052 Veranos at the Orion plant, according to the Automotive News Data Center.

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