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If you are an automobile manufacturer, the first thing to do is to run your factories around the clock, seven days a week. If the demand is not there or you do not have parts, you have to send people home and leave expensive equipment to do nothing, which is terrible for the bottom line. However, GM doesn’t really have a choice at the moment, as it is slowing its full-size pickup production lines due to the continued shortage of chips, reports the. Detroit Free Press.
GM will cut production at several factories because there simply aren’t enough parts to build trucks around the clock at the moment. Flint Assembly will move to a shift for next week, while Fort Wayne Assembly will be inactive for the same period. Silao’s assembly in Mexico will also idle next week, with all three factories hoping to resume normal operations on August 2. The factories are responsible for building GM’s full-size pickup trucks, the Chevrolet Silverado and GMC Sierra. These represent a significant portion of GM’s sales each year, so the effect of the closings will be felt hard over the next few months.
So far, the company has mostly been able to keep its highly profitable pickup trucks in production, but the lingering shortage has finally put things right. Regarding the shutdown, GM spokesman David Barnas said the problems “… are due to temporary parts shortages caused by semiconductor supply constraints,” noting that the company “s ‘expect this to be a short-term problem. ” It’s not just the mics involved either. GM is also idling four factories that are building its midsize SUV offerings for two weeks this month, according to reports from the Detroit Free Press Last week.
You also can’t accuse GM of not trying to get around the issues. Specifications for GM vehicles have been removed in a desperate attempt to ship the product. So far, we’ve seen the automaker ditch HD radio options, auto start-stop systems, and wireless charging for various models. Customers who want to secure a new truck will in many cases have to either settle for less equipment or wait for supply issues to resolve before getting a fully loaded vehicle.
It appears that GM has parked around 15,000 semi-finished vehicles while waiting for parts to become available. The modern auto industry is heavily optimized for just-in-time production, which sees it as a sin with passing gas in an elevator or vomiting in church. After all, the vehicles lying around don’t make any money for the company and actively cost money to be stored. Unfortunately, the given market conditions do not give GM and other affected automakers much choice.
Expect more of the same in the future, as stocks of critical parts run out at various automakers in the months to come. With high demand and the pandemic still raging around the world, it will likely be some time before the situation stabilizes. In the meantime, if you work for a major automaker, perhaps take a coffee tour for the purchasing department. Unlike idle factory workers, they will surely be working late for some time to come.
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