GM, aiming for strong 2016 finish, to hike truck output

DETROIT -- General Motors will boost production of pickups and SUVs in time for the traditionally brisk fall truck market, a top GM executive said today.

GM North America President Alan Batey said the automaker has been scrambling to make enough Chevrolet Silverados and GMC Sierras, and acknowledged that the tight supplies have probably cost GM some sales.

“We wish we had a little bit more inventory right now,” Batey told reporters during a roundtable interview. “We’ve got a slightly better production plan in the second half than the first half.”

The second half of the year is the most important for truck sales, Batey said, typically accounting for 60 percent of the year’s sales.

Many dealers say they could be doing better if the factory got them more pickups. As of July 1, there was an 83-day supply of Silverados on dealer lots or en route to stores, the same level as a year earlier. Ford dealers had a 105-day supply of F series pickups.

After gaining market share in full-size pickups last year, GM was outgunned by Ford Motor Co. and Fiat Chrysler Automobiles in the first six months of the year. Combined, Silverado and Sierra sales rose about 1 percent through June, to 380,118 pickups, trailing the pace of F-series growth (up 11 percent to 395,244) and Ram (up 9 percent to 231,405).

Still, Batey said he feels “really good about the momentum” of GM’s pickup and SUV business, which generates the bulk of GM’s profits. Last week, GM reported a 31 percent jump in its second-quarter North American operating profit, to $3.65 billion, the highest quarterly result since before its 2009 bankruptcy.

One big factor: GM continues to demand stout prices for the Silverado and Sierra, even though the current generation of pickups was launched three years ago, with a substantial refresh for the 2016 model year. In the second quarter, average transaction prices for the full-size pickups were about $2,700 higher than a year earlier, GM said.

For the overall U.S. market, Batey said sales are “arguably running at the top end of the cycle.” But he reiterated GM’s view that the market should “run at or very close to record levels,” citing wage growth, strong consumer spending, low interest rates and the relatively old age of vehicles on the road.