GM Vehicle Production Reduction Planned Due To Rail Car Shortage
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The auto industry has faced a series of headwinds over the last few years, not the least of which was the microchip shortage and other supply chain-related issues that forced every major automaker to cut production, including GM. Now, GM Authority has learned that GM is once again cutting back on its production plans, this time as the result of a rail car shortage. The new rail car shortage arrives just as the parts shortage has begun to ease up, and is likely to result in further reductions in vehicle inventory.
According to a recent report from Detroit Free Press, which cites an unnamed regulator, there are an estimated 70,000 new vehicles waiting for shipment to dealers across the country as the industry struggles with the new rail car shortage. The report also indicates that there are currently thousands of units of the Chevy Silverado and GMC Sierra pickup parked near the GM Fort Wayne plant in Indiana waiting on rail cars for shipment.
Experts say that the disruptions will likely have a major impact on the broader economy. The rail problem has escalated as of late, and has affected food and grain shipments as well.
The rail shortage arrives just as GM is poised to launch several important all-electric models, including the 2024 Chevy Blazer EV and 2024 Chevy Equinox EV, both of which are produced at the GM Ramos Arizpe plant in Mexico. Notably, shipping all-electric vehicles can be particularly troublesome, as EVs can be heavier than their ICE-equivalents due to large battery packs, and as a result, fewer vehicles can be loaded per rack.
The root of the rail car shortage is attributed to a number of different factors, including faster-than-anticipated recovery from the microchip shortage, as well as routing and logistics issues. A shift in consumer demand towards heavier vehicles like trucks and SUVs, demand for Chinese-made vehicles in Mexico, and an increase in Tesla production have all put a strain on available rail cars as well.
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I call BS on all of this story. Just a new excuse to keep inventory low.
We need to cut welfare….. force all the deadbeats back to work. To many still getting their Covid money and trying to be influencers
I agree … because while traveling through an area of eastern Colorado on a vacation, my family and I saw over 100 rail cars for vehicle transport. If there’s that many there, imagine how many there are “hidden” nationwide! All a plan to keep prices high, and demand low. If I go by them again, I’ll get video and submit it to GM Authority.
Up here in Northern Minnesota we have had the flat cars that carry containers, parked on railroad sidings for the last several years. No idea what that is all about.
I don’t think it’s BS. I am in Canada and my vehicle was build at the end of October. I have a VIN and a build number. I am still waiting for shipment of the vehicle
My Silverado was built mid August and it’s still sitting there. This is my first Chevy and if it doesn’t get here soon I might go back to ford. I ordered this with Brembo brake package and performance exhaust. I was excited to get my Chevy but I am loosing my patients.
Maybe you dealers should stop asking for outlandish markups and you’ll sell more. I got a C8 last year with a nice mark up. Wanted a new truck this year and the markup was unacceptable so I went with Ford at sticker
STP – you paid a markup for a Corvette? Why? Did you really need that car that bad? Was it a necessity?
Are you a pinko?
or maybe he had the means to pay for it…jealous much?
Yes. Wasn’t great markup but paid it none the less…but in my mind it’s the best car I’ve ever owned. I’ve had a 911, a cayman and panamera along with 93 zr1 corvette and this car Far outweighs them on drive, power and comfort
STP – It’s people like you that is the reason I can’t get a SS1LE at sticker. Thank you.
This is a moronic statement. There is a shortage of vehicles due to rail cars, therefore dealers do not have the inventory they need to meet demand. And STP here says lower the price and you will get more cars, How does lowering the price going to solve a logistics problem of not being able to ship inventory in volumes the customers are demanding.?
Although I agree that the dealers marking up the price is unacceptable, it is not germane to this discussion.
STP, GM tells dealers not to mark up any vehicles over MSRP and also punishes dealers that do.
I swear this is all on purpose.
Maybe GM needs to make a few rail cars if there is a shortage of them?
What became of the rail cars that were used before the chip shortage?
It seems to be an effort to manipulate the market toward scarcity which results in high prices, fewer jobs and inflation.
What happened to doing waht is right and good for America?
Greed is destroying America
I see where you WERE tracking vehicles, but not any longer. Can you tell me WHERE or what site you were using? I’d be happy to track my own Colorado that was ordered January 17.
Thanks for your consideration.
Bob
“The new rail car shortage arrives just as the parts shortage has begun to ease up” How convenient…… Anything to keep from having to offer manufacturer incentives again. Never heard of a rail car shortage pre-pandemic when all plants were fully operational & dealer lots were stocked.
Many of the railcars used in this service are beginning to age-out so they have to be parked to await rebuild or replaced with new ones. The pandemic closed many of the overhaul shops so now there is a back log of work and a lack of workers to do it. The cars seen parked in many locations are the ones needing rebuild. Federal rules allow a 40 year service life without rebuild.
I’m glad they’re backed up. When they flood the market after this is resolved, they will be 90+ days inventory on lots, so I can go bargain hunting!
I agree. Let this bite them in the arse!
The article says GM is reducing production, to prevent the scenario you are suggesting from happening…
Another Biden blunder for the EV push, the infrastructure isn’t prepared for a smooth transition to EV’s. While John Kerry flies around the world in his personal plane to proclaim the sky is falling. GM and Tesla are better positioned to meet the demand when that becomes reality. Charging and upgrading the grid must be prioritized, but labor shortages will prevent a fast transition. Transporting the vehicles from the factory to the dealers is becoming another issue. Taking much longer than pre pandemic. Truck driver shortages have caused problems as well. The turnaround time from order to dealer is much longer than most consumers can wait. The global supply chain is never going to recover, too many sub contractors involved. Just in time freight and delivery is a nightmare. The transition couldn’t come at a worse time. Trying to determine demand for EV’s will be the biggest issue. Billions invested and little short term rewards to sustain manufacturers. Legacy brands will have an advantage smaller EV companies don’t have, profits to sustain them until the EV’s become popular. The weight issues will be a problem, more range requires a bigger, heavier battery. Consequently the extra weight is a safety concern in collisions. Tires will wear out faster, causing additional environmental impact. We must import most of the precious metals from foreign sources to make the batteries. Energy prices will likely increase with use of more EV’s, battery prices have already increased with increased capacity. Don’t get me wrong, I have owned three EV’s and I like them. 2012 Volt, 2020 & 2023 Bolt EV. They provide excellent urban mobility, but I wouldn’t trade my ICE vehicles either. Commercial vehicles are better suited for fossil fuels. It will be a slow transition to electric and after all, how do we generate electricity? It’s not either or, but both! The consumer will ultimately decide what works for them. Hopefully we don’t have too many blackouts this summer, more the reason we aren’t ready for EV’s! Diverse choices are better for consumers.
OMG, what’s next? Maybe I should just drive 2 hours north to the Ft. Wayne assembly plant and get a new Silverado.
Mary Barra remains to fries short of a Happy Meal. Quick no cost fix. GM can remove the Shipping charge and charge a $200 on site delivery charge and give the discount to dealers and Customers for Factory delivery. All the trucks will be gone in one month.
The prior reader had a few intelligent things to say and for other readers to consider. He lost most, I think when he started with a rant about the President and John Kerry. They have absolutely nothing to do with the supply and transport issues the article is about. How about we leave political views at home and use this forum to talk about the issues at hand. Come on people, The beauty of America is that we are all entitled to our opinions and to freely express them, but why do you feel the need to inject politics into every aspect of our lives (and to make yourself look like a partisan extremist in the process)?
It’s just an excuse for the incompetence of the people in charge of shipping at GM. My 2024 Silverado was built on March 17 and was supposed to ship on March 21. As of today, it is still sitting in Flint, yet trucks built after mine have already arrived at the dealership I ordered thru. The sales manager told me GM won’t give them an answer as to the delay in shipping.
I’m experiencing the same thing with a Canyon sitting in Wentzville.
GM says it’s shipped and to talk with my salesman. I’ve worn him out and he doesn’t have any answers.
The Canyon Denali is even a 2023 model which they are expecting to get sticker price for a year old truck that’s been sitting in a field somewhere.
Your salesman has no answers. Because corporate has zero communication with the dealer. Any dealer willing to give you a timeframe on anything is a liar. No one knows anything anymore.
Why do conspiracy theorists assume that the auto companies are behind this problem? The auto companies profit when the system moves smoothly and the most vehicles can be delivered to customers. There are few incentives to hurt profits right now, so now is when they would love to move those vehicles into customer driveways.
Good idea Tom, but the factories are not equipped to be delivering vehicles to customers. That would involve hiring employees, training them, etc. There are other issues to resolved like the reapportioning of costs between dealer and manufacturer for the work to be done. I suspect the systems to do this could be set up, but probably would take longer than solving the current problems.
There is no Rail Car Shortage. The Rail Cars are just not where they need to be, and the railroads not interested in deadheading them to the plants where the shortages are.
There has been a rail car shortage for over 30 years. I bought my first dealership in 1996 and that was the excuse then for delaying shipping vehicles.
I think I am going to sell my dealerships and buy a fleet of rail cars and lease them at an exorbitant price to all the vehicle manufacturers.
This is incredibly incompetent logistics on the part of the manufacturers.
is Ford, Dodge, RAM, Honda, Toyota having these same issues? If not, than this is just more BS coming out of Mary’s mouth.
This isn’t a problem that wasn’t forecast long ago. Here is an article from almost 4 years ago about why there is a rail car shortage:
https://www.railway-technology.com/features/us-railroad-freight-boxcars/
It’s like everything else in modern business. Short term thinking about proifts and an unwillingness to invest in the future.
If there was enough rail cars before the scamdemic, there should be enough rail cars now. Afterall, all those people that died because of the Rona should of taken some strain off the “system”, should it not have? Sorry, I’m not buying any of this spinning of the truth by the great Mary oh mighty Queen of GM.
I ordered a new 2023 GMC Sierra on Feb.
4th and GM still has not excepted the order. My son found a AT4X in West Virginia we live in Georgia he had dealer ship back to Atlanta. We told dealer in West Virginia about the order placed February that has not been excepted so he said let’s place same order and see what
happens that one has already been made it was ordered end of April makes a lot of sense. Now that is sitting somewhere to be shipped.
GM is no longer accepting orders for 2023 Sierras, they are now on 2024s. Contact your dealer ASAP.
There definitely isn’t a railcar shortage as I’m in the industry it’s all lies