'GM To Scale Back Trucks and SUV Production'

GM To Scale Back Trucks and SUV Production

By Sam Heisin at 04/29/08 05:50

GM, one of the largest auto maker in the world, said yesterday that they needed to shift some of their North American factories from manufacturing trucks and SUVs and instead focused on making cars and crossovers.

This decision made by GM will result to almost 3,500 job lay offs. This will affect 4 factories. Layoffs will start July 14 at the Flint, Janesville and Pontiac plants, and Sept. 8 at Oshawa. The Flint, Pontiac and Oshawa plants make the Chevrolet Silverado and GMC Sierra pickups. The Janesville plant manufactures the Chevrolet Tahoe and Suburban and GMC Yukon big SUVs.

However, the company said that the workers who will be laid off will be working with the unions and will be paid accordingly. They will be paid for a total of 80% of their normal 40-hour gross pay and will get their unemployment benefits.

The company also stated that this shifting will result in about 88,000 fewer pickups and 50,000 fewer big SUVs for this year.

This decision follows the obvious reasons of oil price hikes and the decreasing demand for trucks and SUVs.

For the past three years, the American auto market has been shifting from making big trucks to smaller cars mainly because of the oil that is constantly increasing in value. But this shifting trend increased recently when gas prices reached almost $3.60 per gallon.

On the lighter side, we can see more of GM's new line of cars that will surely be oil efficient for it to compete for the global market and achieve the people's demand on hybrid cars of which GM has already established a good name.

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