The volume impact of the UAW strike at American Axle & Manufacturing continues to expand, idling a growing number of General Motors assembly plants and affected supplier facilities. Today marks day five since output at Pontiac East was idled due to parts shortages. Production was also halted yesterday at Mishawaka, the site of Hummer H2 assembly. A total of six GM vehicle manufacturing facilities are now offline, including Flint Truck, Fort Wayne, Mishawaka, Moraine, Oshawa Truck and Pontiac East. Output at Janesville assembly is expected to be constrained by Monday of next week, prompting the plant to run under a single shift pattern. By Wednesday of next week, transmission shortages are expected to suspend output at Wentzville and by next Thursday, production at Arlington is expected to operate under a single-shift scenario for the same reason.
US light vehicle sales remained weak in February at a seasonally adjusted annualized rate of just 15.4 million units, contributing to particularly heavy inventories of full-frame light trucks. According to Autodata, GM has excess inventory to endure a protracted strike with a 138-day supply of GMT920/30-based full-size SUVs and a 133-day supply for GMT900 full-size pickups at the end of February. Moraine is the first non-GMT900 plant affected by the walkout, with inventory for the GMT360-based mid-size SUVs at a tighter 58-day supply at the end of February.
GM is focusing its limited axle resources on production at Arlington and Silao. These plants have an advantage, as Arlington is the only source of hybrid GMT920/30 SUVs and Silao has a lower cost base versus its sister GMT900 plants. According to plant level reports, GM’s Arlington plant can continue operating into the third week of March.
There are no definitive reports on GMT355-based products at Shreveport, but CSM expects that they could sustain another week before being impacted by the cascading effect of this strike through the supply chain. Inventory for the Shreveport-built compact pickups and SUVs is at a combined 119-day supply. Full-size vans accounted for an 89-day supply at the end of February.
Depending on the duration of the strike, CSM expects that most of the lost volume associated with the GMT900-based products will not be recovered as GM works to reduce bloated inventory levels. Negotiations had been suspended, but are now scheduled to resume at noon on Thursday, 6 March.
To date, Chrysler output has not been affected and the company expects to maintain operations well into next week before shortages threaten to suspend production.
We will continue to monitor events and provide further updates as needed.
For questions, please contact Mike Jackson,
Director, North American Vehicle Forecasts,
at mikejackson@csmauto.com or +1 248 465 2833
For questions, please contact Joe Langley,
Senior Market Analyst, North American Vehicle Forecasts,
at joelangleyn@csmauto.com or +1 248 465 2832
