How GM Improved Logistics To Better Serve Customers During COVID-19
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A two-month factory shutdown, a slow return to previous production levels and challenges facing customers who wish to place orders for new cars – all of it caused by restrictions imposed during the ongoing COVID-19 coronavirus pandemic – combined to make 2020 a memorably difficult year for automakers. For GM, the largest effect in business terms was a U.S. sales decline of 12 percent to 2,547,339 from the 2,887,043 sales in 2019.
Although other factors were also involved, COVID-19 was the single biggest factor responsible for the downturn. Every one of GM’s four brands sold in the U.S. was affected (by over 21 percent in the case of Buick), though strong performances by the Chevy Blazer crossover and Chevy Silverado pickup truck in particular helped mitigate the damage.
But GM could not simply rely on the success of individual models in its portfolio to weather the COVID-19 storm. It also had to sharpen up certain aspects of its business that would have required attention even in a good year, aspects that took on new importance when the coronavirus began to affect business and the world at large to the extent that it has.
As GM spokesperson Megan Soule explained to GM Authority executive editor, Alex Luft, GM made a timely investment in logistics to expand the automaker’s dedicated Class 8 truck fleet. For those unfamiliar with U.S. commercial truck classifications, there are nine categories ranging from Class 1 to Class 8 (with Class 2 technically being split up into Class 2a and Class 2b) based on their gross vehicle weight rating, or GVWR. A Class 8 truck is one that weighs over 33,000 pounds. Such a vehicle is referred to by the Federal Highway Administration (FHWA) as a Heavy Truck, though this broader definition also includes trucks with a GVWR of over 26,000 pounds. In other words, Class 8 trucks are the huge vehicle carriers we see carrying several vehicles.
Like many other automaker, GM employs these Class 8 trucks to transport new vehicles from its factories and distribution centers to dealerships across the country.
By increasing the size of its dedicated Class 8 truck fleet, The General was able to bring vehicles to dealers faster, thereby cutting the time from production to its eventual sale. The result is improved cashflow during the difficult times presented by COVID-19, making the path to recovery smoother and more direct.
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Minor point, but breakpoint for Class 8 is 33000 lb gvwr, not 30k as mentioned in article.
Haven’t seen any evidence of improved delivery…ordered a new Colorado LT on 11/24/20…FINALLY got a build date of week of Feb 22nd. 2021…seems excessive for a SOLD order…nearly cancelled in favor of a new Ram that was available…
Indeed. Corrected now. Thanks for your comment.
Ordered a Yukon Denali on Oct 8th, took delivery on Jan 25th. The longest time I had to wait for a ordered vehicle
The car haulers delivering GM vehicles are operated by independent contractors like Jack Cooper Transport. If GM is expanding their fleet of class 8 trucks it would be conventional trucks used to deliver components and supplies
This is just corporate jargon. Ask the dealerships who see how many vehicles are built and sit outside the factory for months before arriving. The GM invoice gives an estimated arrival time; less than 5% of vehicles are arriving within that time-slot.
GM is doing many things well, but one inarguable fact is that their logistics/fulfillment performance is the weakest sector of their entire operations.
While I am sure GM Authority is thankful for whatever contribution GM gave them to push this message vicariously; it doesn’t conceal the truth of GM’s feeble execution of order fulfillment.
The only car haulers GM owns are the ones used to ferry around prototypes, and they even farm a lot of that out. Chrysler has a small fleet that hauls minivans from Windsor over to distribution yards in Michigan but thats it.
Right. These are independent. The article doesn’t mention that they’re GM owned.