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Six-week production shutdown planned for 2016 Chevy Volt

It's no surprise that GM is winding down production of the first-gen Chevy Volt as it prepares to start building the second-gen for a launch in the second half of this year, but for now, things are proceeding as planned, according to Chevrolet spokesperson Michelle Malcho. Malcho told AutoblogGreen that GM "is still making first generation Volt" and that there has been no announcement about when that will change. The only details she would divulge is that, "It will be this summer." "Halting Chevrolet Volt production in anticipation of the all-new 2016 model year is a smart move for GM," Akshay Anand, an analyst at Kelley Blue Book's KBB.com, said in a statement. "[The move] allows for less inventory and incentives on the outgoing model. Hybrid and alternative fuel vehicle sales have been declining for some time now, with gas prices well below the summer prices of 2014." Volt production will cease in the weeks before the traditional two-week auto plant shutdown over the July 4 holiday. A high inventory of Volts is a factor in the production cuts, but not the only one, Malcho said. The plant construction, engineering changes and pre-production plans for the new Volt and CT6 all were part of the decision, she said. Nationwide, there is about a 200-day supply of Volts on dealer lots (roughly 100 days in California, the car's biggest market), according to the Detroit Free Press, which says there will be a six-week retooling period (twice as long as normal, but other sources say the shutdown will be four weeks long) at GM's Hamtramck plant this summer to get ready for the second-gen model. The 2016 Volt will get an increase in all-electric range to 50 miles and will then get 41 miles per gallon when the battery runs out. It also has a fifth seat that straddles the battery tunnel and a larger li-ion battery. Related Video: The AP contributed to this report. Featured Gallery 2016 Chevy Volt View 16 Photos News Source: GM, Detroit Free Press Green Plants/Manufacturing Chevrolet Electric Hybrid

There's an impending shortage of new trucks in America's heartland

URBANDALE, Iowa — Jerry Bill is worried the novel coronavirus could hurt business at the Des Moines auto dealership he runs, but not because of a shortage of buyers for the big Ram pickups on his lot. "Our biggest issue will be if we don't get more inventory," said Bill, general sales manager of Stew Hansen Chrysler Dodge Jeep Ram, which sells around 2,700 new vehicles a year in Urbandale, a suburb of Iowa's capital Des Moines. After a drop in sales in April when consumers stayed home, Bill expects pickup truck sales to end May similar to where they were a year earlier. And if demand remains strong, Bill said he will run out of popular models in June. Fiat Chrysler began slowly restarting Ram truck assembly lines on Monday after a two-month shutdown. The U.S. economy contracted in the first quarter at its sharpest pace since the Great Recession of 2007-2009 because of lockdown measures aimed at slowing the spread of the coronavirus. Economists warn the second quarter will be much worse. Still, far from the lockdowns of states like New York, Michigan or Ohio, dealerships like Stew Hansen have provided FCA and Detroit rivals General Motors and Ford a rare bright spot: strong sales of pickup trucks in America's heartland. Overall U.S. sales of cars and light trucks crashed to the weakest pace in 50 years last month. But sales of big Detroit brand pickups, particularly in southern and western states less affected by the outbreak, significantly outperformed the market, industry executives and analysts said. Pickup trucks are one of the most profitable automotive segments in the world. They account for a huge portion of the Detroit automakers' profits and formed a huge lure for Peugeot, which expects to merge with FCA by early 2021. The pressure is now on to boost pickup truck production and send vehicles to dealers in parts of the country with dwindling supplies. That is particularly true for GM, which is running short of certain truck models after losing 40 days of production to a strike last fall. "If you don't have what someone wants, they can choose to go to another brand," said Cox Automotive analyst Michelle Krebs. 'Easiest swap ever' Detroit automakers in March rolled out large discounts — such as interest-free loans for seven years — to keep vehicles rolling off dealer lots.

GM profit dips on truck changeover, but beats estimates

DETROIT — General Motors on Thursday reported a higher-than-expected quarterly profit despite a drop in production of high-margin pickup trucks, as it gears up for new models that are expected to boost profits next year. Like rivals Ford and Fiat Chrysler Automobiles, GM is banking on highly-profitable Chevy Silverado and GMC Sierra pickup trucks to lift profits, as consumers shift away from traditional passenger cars in favor of these larger, more comfortable trucks, SUVs and crossovers. During the first quarter, the process of changing over to GM's new pickups resulted in a drop in production of 47,000 units. GM Chief Financial Officer Chuck Stevens said the production drop had resulted in a drop in pre-tax profit of up to $800 million. Earlier this year, GM said its 2018 profits would be flat compared with 2017, but expected its all-new pickup trucks would boost margins starting in 2019. On Thursday, GM reiterated its full-year 2018 forecast for adjusted earnings in a range from $6.30 to $6.60 per share. The automaker said capital expenditures were more than $500 million higher in the quarter because of investments its new pickup trucks and a family of low-cost vehicles under development with Chinese partner SAIC Motor Corp. On Wednesday, rival Ford said it would stop investing in most traditional passenger sedans in North America. CFO Stevens told reporters on Thursday that GM has "already indicated that we will make significantly lower investments on a go-forward basis" in sedans. 2019 GMC Sierra View 21 Photos GM benefited from a lower effective tax rate in the quarter, but adjusted pre-tax margin fell to 7.2 percent from 9.5 percent a year earlier. Stevens said the company's profit margin should hit 10 percent or higher in the second quarter and for the full year. GM said material costs were $700 million higher in the first quarter, and it expects those costs to continue rising. The automaker said it would counter those increases with cost cutting measures. "It is a more difficult environment than it was three or four months ago," Stevens said when asked about rising commodity prices from potential steel and aluminum tariffs announced by the Trump administration. "But we are confident we can continue to offset that." The company reported quarterly net income of $1.05 billion or $1.43 per share, a drop of nearly 60 percent from $2.61 billion or $1.75 per share a year earlier. Analysts had on average expected earnings per share of $1.24.