It’s no secret General Motors’ rising inventories may pose a significant problem if its forecasts prove too optimistic. However, Automotive News reports GM is actually responsible for the most significant share of the U.S. auto industry’s inventory glut.
22 percent of unsold inventory in the U.S. right now is GM’s doing. As of May 1, GM’s inventory levels rose 37 percent altogether to create a 9.5-year inventory high. In comparison, other automakers saw their inventory levels climb just 0.6 percent combined.
GM maintains this build up is completely intentional as it forecasts plant shutdowns and retooling needed for future product. Additionally, the automaker is confident it will have a 70-day supply of vehicles by the end of 2017; the industry’s healthy average is a 67 day supply of vehicles.
Inventory levels from May 1 show GM has a 100-day supply of light trucks and a 97-day supply of passenger cars. Both are hardly healthy levels. GM CFO, Chuck Stevens, said GM is working to reduce its overall supply to 90 days’ worth by the end of June. Plant shutdowns are planned in Michigan and Ohio to help curb the glut.
The GM executive again reiterated the automaker’s intentions.
“Typically, you build inventory in the first quarter anyway, because the spring selling season starts,” Stevens said late last month.
GM announced sweeping idle time for its passenger car plants late last year to help shed mounting inventories and additional slowdowns—most recently in Spring Hill, Tennessee—will occur throughout 2017