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Chevy, GMC and Ram dealers are worried they'll run out of new pickups

One of the unexpected side effects of the ongoing coronavirus pandemic is a shortage of pickups at Chevrolet, GMC and Ram dealers. Supplies are running out, and the factories that build these trucks remain closed. Stores across the nation began increasing incentives in March, when the first stay-at-home orders were issued, in a bid to continue luring buyers into showrooms. They also launched online sales channels, or expanded their existing digital business. Sales nonetheless plummeted in April 2020, but in-demand vehicles, like the Ram 1500 and the Chevrolet Silverado, are still selling relatively well thanks in part to the aforementioned incentives. Pickups outsold sedans for the first time in April 2020, according to The Detroit News, by 17,000 units. The problem is that General Motors, Fiat Chrysler Automobiles (FCA), and Ford temporarily closed their factories in March. "The pipeline is very dry," said Mike Maroone, the CEO of a large dealership group named Maroone USA, in an interview with Automotive News. He told the publication his Chevrolet stores are sitting on a 30-day supply of the Silverado, which is one of America's best-selling vehicles. "That is a problem for us," he concluded. Coronavirus-related lockdowns and factory closures compound problems already faced by dealerships who represent General Motors-owned brands. They entered 2020 with a thinner inventory than a year earlier due to the 40-day United Auto Workers (UAW) strike that paralyzed the company late in 2019, and the 0%, 84-month offers announced in March have sapped supply. Ram wasn't affected by a strike, but it has relied heavily on generous incentives to move trucks off lots. Ford, on the other hand, limited incentives to 2019 models. Inventory levels differ greatly from region to region. The national average for the Silverado stood at an 82-day supply in March 2020, down from 120 in March 2019. Ram stores had a 114-day supply of the 1500 (compared to 134 a year earlier), while Ford bucked that trend with a 111-day supply versus 84 in 2019. Don't panic if you're in the market for a truck; we're not facing a complete drought. Automotive News added that America's light-duty pickup inventory could fall to 400,000 units by the end of May, and drop further to 260,000 units in June. For context, there were about 700,000 light-duty trucks in stock in May and June of 2019. That's unquestionably a sharp drop, but there will still be over a quarter of a million trucks to choose from.

GM's MPG overstatement could affect 2 million vehicles

Late last week, GM admitted that three of its large SUVs fuel economy window stickers did not match their actual efficiency ratings, and so the vehicles couldn't be sold. The stickers on the 2016 Chevy Traverse, GMC Acadia, and Buick Enclave said their ratings were one to two miles per gallon better than they should have been. Officially, the number of affected vehicles sits at about 60,000. But Consumer Reports makes a good point: what's up with all of the previous model year SUVs that are basically the same vehicle? To wit: the 2016 model year vehicles are not substantially different than the 2015 or the 2014, or even going all the way back to 2007. On the EPA's fuel economy website, all of these older models will "have better stated fuel economy numbers than the new vehicles in GM's dealerships," Consumer Reports noted. CR's best point, and the one that makes the 60,000 number potentially grow to 2 million if all of the vehicles built on this platform are affected, is that "[i]t seems unlikely that the company would change the powertrain on these carryover models so late in their model cycles in a way that would cause a dramatic, negative impact on fuel economy." GM says that earlier model year SUVs are not affected and the EPA did not respond to CR's question about the potential for more discrepancies. We've seen automakers reverse course before, so if GM has to come out with a mea culpa soon, don't be surprised. GM is rushing corrected stickers to dealers so that the SUVs can be sold again, but a fix for the already-sold vehicles could be trickier to solve. Related Video: Related Gallery 2013 GMC Acadia View 16 Photos News Source: Consumer Reports Government/Legal Green Buick Chevrolet GMC Fuel Efficiency mpg gmc acadia chevy traverse

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.