General Motors Co. may reduce production of pickups after inventories of its trucks rose last month, Mark Reuss, president for North America, said today.
“We’re going to do something about it, but we haven’t made those calls yet,” Reuss said in a telephone interview. Buyers shifted away from trucks last month, “but no one month makes a trend, so we’ve got to see where this one holds.”
GM’s truck inventory rose to more than 275,000 at the end of April, or about 111 days of supply, Don Johnson, GM’s vice president of U.S. sales, said yesterday on a conference call. The Detroit-based automaker had about 264,000 trucks on dealer lots a month earlier.
“With truck inventory up over 100 days, at some point they probably will have to cut production,” Peter Nesvold, a New York-based analyst for Jefferies & Co., said today in a telephone interview.
GM rose 5 cents to $33.04 at 4:15 p.m. in New York Stock Exchange composite trading. The shares last closed above $33, GM’s initial public offering price, on Feb. 28. The IPO was in November.
GM’s U.S. sales climbed 26 percent to 232,538 vehicles in April from 183,997 a year earlier, the automaker said yesterday in a statement. The results helped push the industrywide U.S. auto sales rate in April to 13.2 million on a seasonally adjusted annualized basis, the third straight month higher than 13 million.
Reuss spoke after GM announced it will add about 250 jobs and invest $131 million to update an assembly plant in Bowling Green, Kentucky, that builds the Chevrolet Corvette. Bowling Green will make the current version of the car for at least the next two model years, including the 2012 version of the sports car that begins sales this summer in the U.S. The investment will be used to prepare the factory for the next-generation Corvette, GM said.
GM said it has invested $3.4 billion and created or kept more than 9,000 jobs in the U.S. since July 2009, when it emerged from bankruptcy. The state of Kentucky offered $7.5 million in incentives as part of GM’s move, Reuss said.
GM said yesterday the Chevrolet Cruze compact car set a record for sales since its introduction last year with 25,160 deliveries in April. The average U.S. price of regular unleaded gasoline rose 37 percent in the past year to $3.98 a gallon yesterday, according to AAA. The price peaked at $4.11 in July 2008.
GM reduced spending on incentives for U.S. customers in April by 8.1 percent to an estimated $3,068 per vehicle, according to Autodata Corp. The automaker is offering rebates of as much as $4,505 for Chevrolet Silverado and GMC Sierra pickups, while offering no rebates on small cars like the Chevrolet Cruze and Aveo, according to AIS Rebates, an Ann Arbor, Michigan-based provider of incentive data to dealers.