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General Motors Idling Five U.S. Plants To Adjust Inventory Levels Of Passenger Cars

As the market continues to make a major shift from passenger cars and sedans to crossovers and utility vehicles, General Motors’ inventory has seen a sharp increase. At the end of November, GM had a 105-day supply of cars, up from 79-day supply in October.

To counter the inventory surge, GM has confirmed it will idle down five U.S. plants in an effort to curb and adjust inventory levels, first reported by The Detroit News. The five plants that will go offline include Lansing Grand River, Lordstown, Bowling Green, Detroit-Hamtramck and Fairfax.

The Lansing Grand River currently assembles the sixth-generation Chevrolet Camaro, Cadillac ATS and CTS; Lordstown, Ohio is responsible for building the 2016 Chevrolet Cruze; Fairfax, Kansas assembles the 2017 Chevrolet Malibu; Bowling Green is home to the C7 Corvette and its variants and Detroit-Hamtramck builds the 2017 Buick LaCrosse and 2017 Cadillac CT6 among other vehicles.

At the end of November, GM also had more than 874,000 vehicles in its inventory, the most in eight years.

GM will idle each plant for two weeks during the month of January as it targets a 70-day supply. An ideal number across the industry is 60 days.

Former GM Authority staff writer.

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Comments

  1. The Alpha platform has been a disaster when it comes to sales performance. The ATS, CTS and Camaro have their strong points for sure, specifically driving dynamics, but it hasn’t been nearly enough to keep folks at Lansing – Grand River employed.

    Reply
    1. A bit on the doom and gloom side, don’t you think? Is the sales performance of cars supported by the Alpha platform related to the platform itself, or the kinds of vehicles said platform is supporting?

      The point is that the Alpha platform is supporting a compact luxury car (ATS), midsize luxury car (CTS), and a sports car (Camaro). While the first two are an uphill battle for Cadillac after decades of mismanagement and damage to the brand, the ATS and CTS are continuing to establish the brand in those highly important segments. Meanwhile, sales volume in each one of the three segments outlined above is down on a year-over-year basis thanks to the crossover craze.

      So, if Alpha supported a compact luxury crossover and a midsize luxury crossovers (as it should, in my opinion) to take on the X3 and X5, everyone would be cheering on its sales success, rather than the platform’s other positive attributes, such as best-in-class driving dynamics, weight characteristics, etc.

      Reply
      1. There would be more optimism if there were even one alpha based SUV/CUV “coming soon” but there simply is not. The CTS (not long ago the marques top selling car) is now all but obsolete? Is it not? The CTS is not sold in China, so why even bother with a new name? CT#?

        Reply
        1. Whether there is or isn’t a crossover coming on Alpha is irrelevant to the current state of affairs. The point is that the architecture is serving its purpose, which is competing with the Germans and making headway into what has been a game dominated by 3 or 4 brands from Germany and Japan, while also providing an excellent basis for Chevy’s mainstream sport car (Camaro).

          As for some of your other points:

          1. The CTS *is* sold in China, albeit in low quantities.

          2. The CTS is far from being “obsolete”. Rather, the segment in which is competes in is currently depressed.

          3. The only reason that the CTS was “not long ago the marque’s top-selling car” is because it straddled the lines of compact and midsize for the price of a compact, a strategy filled with corner cutting for which Cadillac is now paying the price by finally aligning to market demand with two vehicles (ATS and CTS) rather than just one (tweener CTS).

          So saying the CTS was Cadillac’s top-selling car is true, but a significant oversimplification, as one must realize why that was. And that’s not taking into account sky-high incentives and sub-terranean ATPs (the first and second gen CTS had the lowest ATPs in the segment). I’d wager than the current ATS and CTS are resulting in higher gross and net profits per vehicle program for GM than the second-gen CTS ever did.

          The unfortunate state of affairs is that, prior to the ATS and third-gen CTS, Cadillac had zero presence in the compact luxury segment and zero presence in the midsize luxury segment, a factor that relegated it to also-ran status in the luxury game. Now, Cadillac has a compact (ATS), midsize (CTS), and full-size (CT6), all of which go head-to-head with the appropriately-sized rivals from the Germans and from Lexus.

          So, are you suggesting that Alpha is not doing its intended job, as per my description above?

          From a bigger-picture standpoint: it will take time (a long time) for Cadillac to start dealing anywhere near the sales volumes of its direct rivals. But that long-term game and associated (time and financial) investments are so very much worth it. That’s why you “bother” with a CT5/CTS replacement, and that’s why you “bother” with Cadillac in general.

          Reply
    2. As long as Americans have their heads up their asses about buying Japanese, Korean, and German cars over American it doesn’t matter what GM, Ford, and Chrysler build. These same Americans list as their top five priorities jobs, economy, immigration, health care, and security they simply are too stupid to realize that buying American=jobs…..They think Toyotas and Hondas are better made, Hyundai’s are cheaper, Benz’s, Lexus, and BMW’s are more of a status symbol than anything American , and what the hell are all those SUV, and pickup truck owners gonna do when gas goes up 30%-40% this year (2017) as it is forecast to do……

      Reply
  2. The CTS is now the slowest selling Cadillac sedan, even trailing the CT6. Does Cadillac need 4 sedans? Can’t axe the XTS just yet, it sells here and in China! CTS sales are down 50% since calendar year 2014. Others (A6, E, GS, 5 series), are also down, but none of those have lost half of their volume in 2 years.

    ATP – go tell people losing their job about how great the transaction prices are.

    Reply
    1. Let’s play with the notion that the CTS is the slowest-selling Cadillac… and let’s take it one step further by asking “why”.

      First of all, the CTS — even at its current depressed volume as a result of crossover-crazy consumers — is making GM profit hand over fist. In that aspect alone, it accomplishes its goal.

      But then let’s turn to figuring out why it is the slowest-selling? The answer is simple: with the third-gen CTS, the vehicle stopped being a midsize luxury sedan at compact luxury sedan prices, which the first- and second-gen CTSes were. In other words, the space in which the first- and second-gen CTS competed in has (mostly) been taken over by the ATS, while the third-gen CTS has carved out a new space and brought a new kind of customer for Cadillac that it did not have before, customers who in the past would have bought an E Class, 5 Series, GS, etc. In fact, the same can be said of the ATS, which has begun to attract a new kind of customer to Cadillac that previously purchased the C-Class, 3 Series, IS, etc.

      You might as well call the ATS the CTS, and the CTS something else — since that represents the movement in segments between the two vehicles.

      I honestly think that the strategy of clear segment positioning is simple and doesn’t need to be defended. If it does, then at the end of the day, Cadillac is much better off with a compact and midsize sedan that provide clear delineation (in size, features and price) compared to having one vehicle straddling both segments (as the first- and second-gen CTS did). So yes, having two clearly-positioned vehicles instead of one tweener results in more or less the sales volume but much higher ATPs and ensuing profits, which is GM’s purpose in this world… not to employ as many people as possible. Sure, it’s sad — but Cadillac will be adding four new CUVs to its lineup within the next few years, and perhaps those who are losing their jobs today will be able to find their jobs working on those crossovers tomorrow. Or perhaps the bigger issue is why Americans aren’t buying Cadillacs when they are just as good as or better than the competition.

      And to answer your question of whether Cadillac needs 4 sedans in its lineup? The answer is: “It doesn’t only need four, it needs more!”

      In a few years, Cadillac will have a sub-ATS sedan to compete with the likes of the CLA and A3 (and BMW’s upcoming 1 series sedan), so it will be on par with its rivals in that regard, while also having the XTS to satisfy “stop-gap” customers. And that’s not to say anything about the “four-door coupe/gran coupe” idea pioneered by the Germans, which are huge profit drivers.

      Reply
      1. The 1st gen CTS was 190″ long, current CTS is 195″ long. So yes the CTS has grown beyond its original mission. But the ATS is 183″ long, 5″ shorter than the 1st gen CTS in the wheelbase. Plus the ATS makes very poor use of interior space, even for a 183″ car, and it rides harder than a BMW. Seems to me every time Cadillac tries to make a small car (see the Cimarron), it fares poorly. I’m not sure a sub-ATS would be a good way for Cadillac to go. I’d rather see a new ATS that’s bigger (say 187″ long), roomier inside, with more of a soft Cadillac ride, or at least softer than BMW. Priced the same as BMW 3-series and compete to some degree, but it would be bigger and more “Cadillac”.

        The CTS and ATS are nice looking cars, and in an alternate universe they might fit into a niche. But they are too cramped and hard-riding for most Cadillac buyers, and they will never be German enough for the German car buyers (the proof is that ATS “out Germans” the Germans and yet German car buyers still don’t want it, as it lacks a German badge).

        Past history shows that Cadillac runs into trouble when going small (Cimarron), and going German (Catera). What were they thinking when they decided to both go small and German-like with the ATS? The results are in the sales numbers.

        Reply
        1. With the below comments, you are making highly subjective and highly-qualitative observations that fail to take into account market realities. So, please allow me the opportunity to address your statements in the context of reality. Specifically, I’m referring to these:

          “Seems to me every time Cadillac tries to make a small car (see the Cimarron), it fares poorly.”

          and…

          “Past history shows that Cadillac runs into trouble when going small (Cimarron), and going German (Catera). What were they thinking when they decided to both go small and German-like with the ATS? The results are in the sales numbers.”

          The fact is that Cadillac has historically been almost entirely absent from the small car arena, specifically the sub-compact and compact segments. Meanwhile, its most direct rivals have been present in those spaces for 30-40 years. This puts Cadillac at an obviously steep disadvantage, even if its product was indisputably the best (which it currently is not, despite being very good).

          So, what is Cadillac to do — give up on the world’s biggest (by volume) and most lucrative (by profit) segments and go home? Seems to me that this is what you are recommending, as your observations are pretty much on the glass half empty side. No, that’s not what its strategy should be — and that’s not what it has been and is doing. Instead, it’s choosing to compete with such vehicles as the ATS (and its respective CT# replacement), as well as the forthcoming sub-ATS vehicle. It is a long-term game measured in years leading to decades, not months leading to years.

          To recommend (as per your comment) that Cadillac isn’t successful in serving Cadillac faithful or in attracting those loyal to German luxury brands with the ATS or CTS is inaccurate. Again, I’ll advise you to keep the long-term strategy in mind.

          And the reality is actually quite bright: Cadillac’s first true foray into the compact space (with the ATS) has been quite successful, especially considering the extremely competitive nature of that segment. The ATS and third-gen CTS have established a “base” for the brand in those segments, upon which it will build well into the future.

          So, ultimately, there is no other option for Cadillac than to continue establishing itself in every segment that is dominated by its competitors from Germany and Japan (Lexus), including sub-compact, compact, midsize, full-size — across each vehicle category, including sedans, coupes, or crossovers.

          Reply
          1. Merry Christmas Alex (and everyone) – thanks for creating this website, and thanks also for your thorough and thoughtful comments.

            The thing is, Cadillac is a brand, not a company. GM is the company. GM can make smaller cars that leverage GM’s auto-making expertise across all brands. GM is not missing the market on smaller cars. But I do believe that the Cadillac brand is compromised when they try to rush headlong into the small car and/or German-like (sports driving rather than luxury driving) market.

            It’s ironic to me that some feel that Cadillac needs to remake its brand image, as if it were just starting up in the 21st century (or maybe just starting up right now). And their “proof” is that the old Cadillac brand was hurt by prior missteps. The irony is that when asked to point to the failures that hurt the brand, it’s usually things like the Cimarron (small Chevy Cavalier rebadged and slightly upgraded as Cadillac) and Catera (German car rebadged as Cadillac), or maybe the V8-6-4 engine that was Cadillac’s attempt to offer fuel efficiency like the imports. What did not hurt Cadillac was Cadillac being Cadillac.

            Now if it is possible to make a small Cadillac (say 187″ long, no smaller) that is roomy inside and has a plush interior, a strong engine, bold angular syling, useful tech features, and a nice comfortable ride, then I’d be ok with that – because that would be retaining Cadillac values. The laws of physics make it fairly difficult to offer a small car with a roomy interior and smooth ride – but if it can be done, great.

            As I’ve mentioned before, GM should have kept Cadillac as their roomy-comfortable-luxury brand, and turned Corvette into an entire line-up to compete with the Germans (sports luxury) if they really thought there was room for yet another German-like brand. But now GM seems determined to have Cadillac abandon the values they once had, in pursuit of being a BMW imitator, and that’s just not working. The sales show it. And as Americans age (and become ever-larger) and may tend to want comfortable cars rather than sport-riding cars, GM may well wish they had kept Cadillac as the Cadillac of cars, rather than trying to make it the BMW of America (and failing even in that).

            Reply
      2. When exactly are they adding 1 new CUV?? 2020?

        Regarding “why” the CTS struggles? Here’s one reason, it’s a poor value in the eyes of many vs others sedans in the same showroom! Go build a 2017 CTS, XTS and CT6. If you spec. 3.6L, AWD and Luxury trim on all 3, the prices range from about $54K for an XTS, to $57.5K for a CTS to 61.5K for a CT6. 3 sedans in the same price range fighting for sales in a shrinking segment. That my friends, is mis-management!

        Reply
        1. All three new Cadillac crossovers are coming before 2020. Read here:

          http://gmauthority.com/blog/2016/03/cadillac-clarifies-its-upcoming-crossover-surge/

          The overlap you describe does exist, but it is temporary. In reality, you should disregard the XTS and its “overlap” in price, as it not the same kind of car as the CTS and CT6, but rather a totally different animal meant for a specific demographic, the kind that Cadillac isn’t looking to steal from the Germans.

          So, keeping the XTS out of it, let’s focus on the CTS and CT6. Though the CT6 is positioned roughly $10,000 above the CTS, its pricing is still a bit too close to that of the CTS. The easy way to fix it is to move the CT6 up-market, something I believe Cadillac will do in the mid-term future.

          For the time being, though, the vehicle is Caddy’s first true foray into the full-size luxury game the way the Germans have been doing it (RWD, longitudinal engines, etc.). In other words, this is only the beginning in what is otherwise a long-term game, as per my reply to Drew above.

          Reply
  3. sedans arnt selling anymore….it was a mistake that Cadillac didnt put CUVs on the Alpha platform and didn’t give Cadillac a new design theme….the ATS looks vary lame and the CTS looks dull.

    Reply
    1. You are correct in saying that the Alpha platform should have been used as a basis for crossovers, at least two in my book.

      But you are way off in your highly-subjective conclusions regarding the design of the ATS and CTS. Way, way, way off. The styling is the one competitive advantage Cadillac is holding on to, and will only improve going forward. It is not a detractor in purchase or purchase intent (I repeat, NOT a detractor).

      Reply
  4. Cadillac doent need more sedans….it needs less sedans and more crossovers…why would they build more vehicles the arnt selling like hot cakes and by the way a four door coupe wouldn’t go with Cadillac.

    Reply
    1. Cadillac needs more of everything — crossovers, sedans, coupes, four-door coupes, roadsters. The crossover segments are obvious and will be filled out. The sedan segments where Cadillac currently competes are not growth segments. But if Cadillac had a car in the new compact class to rival the CLA or A3/S3, then it would add roughly 1,000-1,500 sales units per month to its cumulative sales volume, and make a hefty margin on the car by deriving it off the highly-leveraged D2 architecture.

      Four door coupes go well with anything, Cadillac or otherwise. No idea what you think that they don’t.

      Reply
  5. General Motors CEO Mary Barra needs to cut deadwood and Cadillac CEO Johan de Nysschen is DEADWOOD; the poor sales of the ATS and CTS demonstrates a lack of leadership as de Nysschen just doesn’t understand the US market.

    Reply
  6. With such a high inventory and plants heading into idle, what a great opportunity to use this spare capacity to move into RHD production to satisfy those markets that would love to have some of these cars. The Camaro would be an excellent starting point.

    Reply
  7. I think the car that will set above the CT6 should be a CT7 that compeats with the S class 550….and a CT8 should compeat with the Maybach 600…Cadilac did mention that these would be at least 2 cars above the CT6.

    Reply

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