GM dealers run short of 4-cylinder crossovers
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DETROIT -- General Motors is scrambling to increase availability of popular Chevrolet Equinox and GMC Terrain crossovers with four-cylinder engines.
For two months, tight supplies of the 2.4-liter four-cylinder versions have forced GM to restrict dealer orders for those vehicles, which account for the vast majority of Equinox and Terrain sales. That has many dealers ordering more 3.0-liter V-6 models than they would like in the face of sharply rising fuel prices.
GM spokesman Jim Cain confirmed that there are "temporary order limits" in place on four-banger versions of the Equinox and Terrain.
"It's a function of a strong industry, a hot vehicle and very robust demand for the four-cylinder model," Cain wrote in an e-mail. "We're working with our suppliers to increase deliveries of key components" to meet demand.
GM has told dealers that the supply constraints are temporary but it hasn't said when it expects the issue to be resolved, Cain said. He wouldn't say which suppliers GM is working with, although he said it was a Tier 2 supplier problem related to certain parts that go into the four-cylinder versions. He said the problem was not availability of the engines themselves.
Four-cylinder models accounted for 79 percent of Equinox and Terrain sales in February, down from 87 percent during all of 2011, Cain said.
Many dealers say the V-6 models have gotten tougher to move in recent weeks as gasoline prices have risen. The U.S. average for regular gasoline rose to $3.79 a gallon last week, up 20 cents from two weeks earlier, according to the U.S. Energy Information Administration.
"I cringe when I have to order a six," says Eduart Lela, general sales manager at Herb Chambers Chevrolet Cadillac in Danvers, Mass.
On a recent order, GM required Lela to take V-6 engines on three of the eight Equinox crossovers he requested. He would have preferred all four-cylinders.
In recent weeks, GM has offered $1,000 in dealer cash on V-6 models to lift sales. It's not offering any dealer cash on the four-cylinder versions, according to AIS Rebates, an Ann Arbor, Mich., firm that provides incentive data to dealers.
Michael McGuire, principal at McGuire Chevrolet-Cadillac in Newton, N.J., says the four-cylinder Equinox has become a hot commodity for dealers swapping vehicles.
"I won't give up a four-cylinder unless I'm getting a four in return," he says.
Cain says both models are selling well, though the four-cylinder versions are in higher demand. In February, four-cylinder Equinoxes took an average of 30 days to sell, compared with 39 days for V-6 versions, GM says. Terrain sales took an average 44 days for the four-cylinder and 49 days for the V-6.
Overall, availability of the crossovers has eased after nearly two years of tight supply. GM had a 54-day supply of the Equinox as of March 1, up from a 30-day supply a year earlier, according to the Automotive News Data Center. Supplies of the Terrain stood at 74 days, up from 34.
You can reach Mike Colias at mcolias@crain.com.
