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GM's redesigned full-size 2021 SUVs face delay over coronavirus

As General Motors works to conserve cash for the coronavirus pandemic, the automaker reportedly told suppliers that it is postponing development of several future vehicles. The situation may cause GM to delay the launch of the 2021 Cadillac Escalade, GMC Yukon, Chevrolet Tahoe and Chevrolet Suburban SUVs, which had been planned to roll out in April. The original launch plan for the redesigned full-size SUVs, which are some of the most profitable vehicles produced by GM, had called for production of the current models to end at its plant in Arlington, Texas, this week. After a retooling process, the redesigned SUVs were slated to begin production late in the month of April. In an email to suppliers viewed by Reuters and confirmed as authentic by GM, the automaker also said it was suspending development work on six future vehicle programs, including updates of the Chevrolet Equinox, GMC Terrain, Cadillac XT4, Bolt EV, Chevrolet Silverado and GMC Sierra. GM said preproduction work on those programs would be pushed back to calendar year 2021, with most of the updated vehicles scheduled to be launched as 2022 models. According to the Detroit News, work has also been paused on the Chevy Camaro and a future version of the Corvette that has yet to be unveiled and wasn't planned for production during the 2020 calendar year. Last week, the automaker told employees and suppliers it was delaying work on some future vehicles while pushing ahead with near-term models such as its redesigned full-size SUVs and the GMC Hummer EV, Cadillac Lyriq, Chevrolet Bolt EUV and Cruise Origin, as well as its new Ultium battery system. A GM spokesman who spoke with Reuters reiterated on Monday what the automaker had said last week — that the situation with its U.S. plants was "fluid" and that the automaker would "continue to evaluate" whether and when to reopen those plants on a week-by-week basis, with "employee safety" guiding that decision. GM said previously that it was closing most of its U.S. plants indefinitely. In its Monday email, GM asked suppliers to stop work on all pre-production tooling and pre-production parts manufacturing, but also not to dispose of any tooling or materials. GM told Reuters it had solicited volunteers from its workforce to finish the build-out of the current SUVs on a single shift in Arlington.

Most of the US won't get 2016 Chevy Volt

Every major plug-in vehicle launch in the US has been a patchwork operation, with automakers focusing their initial efforts on targeted locations like California where they expect to sell the most units. Today, we learned that even five years into the plug-in car project, the game remains the same. According to GM, the second-gen Chevy Volt is going to be rolled out in the same manner. In fact, GM is limiting availability of the 2016 model year Volt so much that most of the US will not have access to the car at all. For 39 states, the second-gen Volt will first be available as a 2017 model year vehicle at some point in the spring of 2016. When GM announced the buying process for the new Volt, it made it clear that dealers in California would be the first to place their orders. Hybrid Cars now reports that the first deliveries will be also limited to California and 10 other states that follow the California Air Resourced Board (CARB) rules: Connecticut, Massachusetts, Maryland , Maine, New Hampshire, New Jersey, New York, Oregon, Rhode Island, and Vermont. GM spokesman Kevin Kelly told AutoblogGreen that this is all according to plan. "Chevrolet has a shortened model year for the 2016 Chevy Volt that will have a limited distribution network," he said. "The 2016 Volt will be sold in our strongest EREV markets. The 2017 Chevrolet Volt will begin production early this spring and will be available throughout the country." It appears that non-CARB state Volt customers will be able to order their Volts starting October 1, according to documents posted on Hybrid Cars, where we also learn that 2016 Volt production for California started in August, will begin in late October for the other 10 CARB states, and in early 2016 for the rest of the US. Unsurprisingly, dealers outside of the 11 CARB states have been complaining that they can't order the much-anticipated new Volt for their customers just yet. Related Video:

Weekly Recap: The implications of strong new car sales

New car sales are on a roll in the United States this year, and analysts are optimistic the industry will maintain its torrid pace. Sales increased 1.6 percent in May and reached an eye-popping seasonally-adjusted selling rate of 17.8 million, the strongest pace since July 2005, according TrueCar research. That positions the industry for one of its strongest years ever, as consumer confidence, low interest rates, low fuel costs, and an influx of new products propel gains. In addition to the positive economic factors, May also featured warmer weather across much of the US, an extra weekend, and it came on the heels of relatively weak April sales. Analysts suggest income tax refunds and the promise of summer driving and vacations also traditionally help May sales. "While 2015 will be one of the best years in the history of the US industry, in some ways it may be the very best ever," IHS Automotive analyst Tom Libby wrote in a commentary. "Not only are new vehicle registration volumes approaching the record levels of the early 2000s, but now registrations and production capacity are much more closely aligned so the industry is much more healthy." Capacity, an indicator of the auto sector's health, is also expected to grow. Morgan Stanley predicts it will eventually hit at least 20 million units per year, as many companies, including General Motors, Ford, Tesla, and Volvo are investing in new or upgraded factories. "The best predictor of US auto sales is the growth in capacity, and frankly, we're losing count of all of the additions – there's literally something new and big every week," Morgan Stanley said in a research note. Transaction prices, another telling indicator, also continue to show strength. They rose four percent in May to $32,452 per vehicle, and incentives dropped $10 per vehicle to $2,661, TrueCar said. "New vehicle sector and segment preference indicates consumers are confident about the economy and their finances," TrueCar president John Krafcik said in a statement. Still, Morgan Stanley noted the robust sales did little to immediately impact automaker stock prices and suggested it might be a prime time to sell if sales reach the 18-million pace. "Perhaps the biggest reason may be that investors have seen this movie before," the firm wrote.