It’s no secret that automakers are struggling with a few issues right now, not least of which include slumping overall 2017 sales and a vast reduction in demand for smaller, passenger vehicles. While many are cutting jobs and shifts, at least in the short term, it appears some are moving onto to step 2 – dramatic shifts in product offering.
Automotive News is reporting that our friends in Detroit – GM – experienced a 36 percent drop in sales of passenger cars in the month of June, which was well higher than the industry-wide average decline of 14 percent.
Now Autoblog says that GM may kill as many as six slow moving vehicle models by 2020.
So which ones are on the chopping block? Things don’t look good for the Chevy Volt hybrid, whose sales have been hampered by low gas prices and consumers gravitation towards the roomier cabins and storage of a larger vehicle. Reuters says this model could be replaced by a hybrid crossover model by 2022.
Among the others identified are the Buick LaCrosse, Cadillac CT6, Cadillac XTS, Chevrolet Impala and Chevrolet Sonic.
So how will this impact U.S. auto industry jobs? Well, if GM can focus on innovative new products then hopefully not much. An analyst for Morgan Stanley was quoted as suggesting passenger cars will account for fewer than 10% of new product rollouts for GM over the next couple years.
But other analysts are intimating that these product line changes could signal the death knell for Detroit’s Hamtramck plant. Not only is this assembly plant responsible for producing four of the six at-risk models, but they also churned out 35,000 vehicles in the first half, down 32 percent from the same period last year. Autoblog says a typical GM assembly plant puts out between 200,000 and 300,000 vehicles each year.
I’m Anna Wells and this is IEN Now.