General Motors announced Monday significant changes in North American car production. The company is expected to slow or altogether end production of some models, and shutter some assembly facilities. The Chevy Impala and Volt, Buick LaCrosse, and Cadillac CT6 and XTS sedans likely will end production some time next year due to slowing sales.
Sources who were not authorized to discuss production changes hinted at the changes last month. An official at GM in October confirmed that some employees have been prepped for a significant announcement, but were not given details.
Like crosstown rivals Ford and Fiat Chrysler Automobiles, GM will pare down the number of small cars available in North America dramatically. Its electric-car strategy also may be in flux: It’s unclear if the current Bolt EV could live on as a Chevrolet, as a Cadillac, or as a semi-autonomous vehicle, which would represent a considerable shift in philosophy for the company. GM has promised it will build and sell 20 electric vehicles in various global markets by 2023.
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The Chevrolet Impala and Cadillac XTS—cars made in GM’s aging and shrinking Oshawa, Ontario, plant—would be likely to fall victim to the move toward crossovers and trucks first.
Production at the Canadian plant had been slowly declining in recent years as GM moved the Camaro to Michigan, and Impala and XTS sales have dwindled along with sales of other large sedans. A second Oshawa facility produces the last-generation Chevy Silverado, although that’s likely to end in less than a year as GM ramps up production of its new-generation Silverado and GMC Sierra trucks at other plants in the U.S. and Mexico.
Cars made at Detroit-Hamtramck, Michigan, and Lordstown, Ohio, will be discontinued or move to other nearby GM plants.
2019 Chevrolet Cruze
The Chevy Cruze, whose sales have collapsed from more than 273,000 in 2014 to just over 100,000 in the first 9 months of this year, has a less certain future. The Lordstown plant, near Warren, Ohio, where the Cruze is produced has slowed to just one shift as sales have slumped.
The backdrop for the large announcement is looming negotiations with union workers at GM plants. Although GM has posted profits in prior years since the last negotiations with the UAW in 2016, GM CEO Mary Barra has publicly said that the automaker would need to adapt to a slowdown in auto sales from record highs in 2016 and 2017. The company reported negative cash flow for the first nine months of this year. Contract negotiations with the UAW are slated to begin next summer.
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Stock in General Motors has slipped more than 20 percent in the last year, and investors may be looking for ways to capitalize on surging crossover and truck sales and shed low-margin sedans and small cars.
GM’s push toward electric and autonomous cars also may change slightly with the announcement.
Although the plant that currently makes the Bolt EV may be in danger, the push for more electric vehicles is clear. Moving production of the Bolt to a nearby plant could coincide with a move to push the Bolt EV into a more popular segment—perhaps even as a crossover—and spin off other future cars based on that platform.
Internet Brands Automotive reporters Aaron Cole, Joel Feder, and Marty Padgett contributed to this report.