GM's Lambda crossover vehicles are selling well, yet the company has decided to cut one of three shifts at its Lansing plant where the vehicles are produced. The move will cut 1,000 jobs by the end of the year, of which 497 were temporary anyway. The remaining 510 low-seniority workers will either be sent to another plant, or they will enter the jobs bank. The Buick Enclave, Saturn Outlook, and GMC Acadia have sold at an average of 13,000 units per month for the past few months, and the Enclave has been sitting on dealer lots just a bit less than a month before selling. The Detroit News quoted GM spokesman Tom Wickham as saying that demand is not slacking, and that the third shift was viewed as a temporary measure to meet initial demand for three vehicles.
[Source: Detroit News]
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Reader Comments (Page 1 of 2)
Stealth E34 @ Oct 23rd 2007 9:13AM
Did GM over-estimate initial demand? I'm quite surprised GM would have to eliminate so many jobs so soon, especially on shifts for what are supposed to be 'turn around' vehicles for the company.
I know they are selling quite well and I see them everywhere (my next-door neighbour just traded in his Montana SV6 for an Enclave!) but I think GM might have been a little optimistic about early sales.
Losing all those jobs is terrible, but if it saves GM money and keeps them competitive (and on the road to financial recovery) then it's a smart move.
Big John @ Oct 23rd 2007 11:09AM
So what is temporary to you? Six years? You must be from the UAW.
Bananas @ Oct 23rd 2007 11:19AM
GM UNDERestimated initial demand. The third shift was done to catch up to demand. Can't you read? This was stated in the end of the article above, and is COMMON knowledge that they had done this. Now that they have caught up, they are going back to a "normal" production run of two shifts.
It is just regular old business practices to try to maximize profits by meeting demand, and not overproducing.
Mr. Oak @ Oct 23rd 2007 9:15AM
I think the phrase we are looking for here is "Inventory Management". No need to build vehicles just for the sake of building them. Very shrewd move.
Mr. Oak @ Oct 23rd 2007 9:18AM
Of course the Enclave is going to sell slower than the Acadia\Enclave. It's the same reason BMW sells more 3 series than 5 or 7 series cars, cost. Especially since they're mechanically identical.
Still think it is smart of them not to over build.
Mr. Oak @ Oct 23rd 2007 9:33AM
Of course the Enclave is going to sell slower than the Acadia\Outlook. It's the same reason BMW sells more 3 series than 5 or 7 series cars, cost. Especially since they're mechanically identical
Still think it is smart of them not to over build.
Brett- BMW Advocate @ Oct 23rd 2007 9:20AM
At least GM is starting to come back around and move slightly ahead of Toyota. How many Toyota employees have been laid off after a new vehicle launch, though? I agree with Stealth, if it saves money and half were temporary employees anyways, then its a smart and unfortunate move.
Rick @ Oct 23rd 2007 9:40AM
The Buicks look solid but have hideous front ends/grills. The Saturns are overpriced euro-reproductions and and the Arcadia is a photocopy. I understand the demand issue.
B @ Oct 23rd 2007 11:08AM
and I have no idea what an Arcadia. I own an Acadia, it's really nice.....same Lambda as the US designed and built Saturn Outlook.
FThorn @ Oct 23rd 2007 10:24AM
toyota laid off 350 workers.
http://www.autoblog.com/2007/04/25/toyotas-indiana-plant-shedding-370-temp-workers/
Ligor @ Oct 23rd 2007 11:06AM
well,
i believe GM wanted to sell more thant he 13000/mpnth that it's selling
they assumed right not to overbuild adn had extra employees on hand just in case the demand shoot way up in the 16000/month range
B @ Oct 23rd 2007 11:07AM
Euro reproductions? Ehhhhh.
Rick Lyon @ Oct 24th 2007 7:34AM
Sorry, spelled it wrong. But yes, it's the Outlook duplicated. Not saying it's not nice, just it's already done so who is the other marketed for?
Josh Oliver @ Oct 23rd 2007 11:23AM
Chris...did you really just say "of which 497 were temporary anyway???"
You do realize that these "temporary" workers have been with GM since the buy-outs, and many even before that. Some have been with the company two years.
Furthermore, these "only temporary" workers were promised JOBS with GM if the landmark contract with the UAW was approved. Of course the temps, some up to 500 or more at GM plants voted yes because they were under the false pretense that they would turn their temporary position into a permanent job. So what does GM do once the deal is ratified?
Why...they lay off every single temporary worker the company has! Look at Poletown. Look at Truck & Buss in Pontiac. Every lay off is a temp.
elprogramer @ Oct 23rd 2007 4:17PM
^Speaking as a new hire, there was a girl who just got hired on the assembly line. She'd been a temp for ten years, getting fired and rehired every 90 days.
But layoffs are a part of being an autoworker. Production and sales are cyclic, and even those who didn't get hired in full time will have a job in two years when all the old folks retire.
psarhjinian @ Oct 23rd 2007 11:29AM
Fuel is expensive and these things are heavy. I'd be suprised if any larger SUVs and crossovers were moving, regardless of who makes them.
Sure, they're slightly better packaged than the traditional body-on-frame SUV, but betting the farm on things like this and leaving the entry-level to rot is not a good idea. Toyota is doing this too (letting the Yaris and Corolla go while throwing dollars at the bigger vehicles) and it will be difficult to claw back happy Fit and Versa buyers when their time comes around.
I understand the allure of unit gross margin, but perhaps this is not the time to have thrown development dollars at a segment that's likely to crater?
elprogramer @ Oct 23rd 2007 4:19PM
Fuel is *not* expensive. Imagine if we ran our cars on water or milk...
People are just cry babies, like they've always been. Remember diesel? That went far.
raz @ Oct 23rd 2007 1:23PM
I hope Ford Employees are seeing this for what it is. GM is firing employees and the same will happen to many Ford employees. Not to meantion that GM is in much better shape than Ford is.
Once Ford will get concesions from UAW they will fire a LOT MORE than a few thousand people.
IF UAW employees want to keep their jobs they a need to launch a huge strike at Ford...one lasting two to three weeks, stopping Ford from producing a single car in that time period.
Tagg @ Oct 24th 2007 1:44AM
Yeah, so the company can file for bankruptcy, get the contracts thrown out and essentially hire temp workers to work for half the cost.
Thats pretty much what Delphi did.
raz @ Oct 23rd 2007 1:25PM
I am not sure about a Versa buyer, but a Fit buyer has no reason to leave Honda, because Civic is GREAT and so is Accord.