General Motors is delaying the resumption of second shifts at truck assembly plants in Michigan, Indiana and Mexico because of a lack of parts from Mexico, a person briefed on the matter told Reuters.
GM, which resumed production on Monday after suspending operations in March because of the coronavirus pandemic, will launch a second shift next week only at its Lansing Delta Township plant. It will not immediately begin, as it had earlier hoped, second shifts at its Fort Wayne, Ind., Flint, Mich., and Silao, Mexico, plants that build full-size trucks, but could resume a second shift by later next week, the source said.
GM spokesman Dan Flores said "demand for our full size picks has been very strong so we are certainly exploring ways to add production and will do that when it makes sense."
Mexican auto parts production is only this week beginning to slowly resume. GM's decision to delay resuming some production shifts shows the challenges of resuming production with thousands of suppliers.
Last week, GM suppliers were told the company planned to resume three-shift production at it Fort Wayne plant and other plants as soon as June 1.
Sales of big Detroit brand pickups, particularly in southern and western states less affected by the coronavirus outbreak, have recently significantly outperformed the market, industry executives say.
Large pickups, including Ford’s F-series line, GM’s Chevrolet Silverado and GMC Sierra and Fiat Chrysler’s Ram, accounted for nearly 21 percent of all light vehicles sold in the United States in April, Ford vice president for U.S. sales, marketing and service Mark LaNeve said earlier this month. Normally, the pickup segment is 13-14 percent of total sales.
Strong Silverado and Sierra sales buoyed GM’s first-quarter earnings and gave analysts hope that CEO Mary Barra could eke out a full-year profit. The virus disrupted efforts to build pickup inventory back up following the UAW’s 40-day strike in the second half of last year, and dealers are having trouble keeping enough trucks in stock.
The Silverado is the vehicle “in the most demand relative to the supply we have,” Mike Jackson, the CEO of AutoNation Inc., the largest U.S. new-car retailer, said in a Bloomberg Television interview. “If they can restart the pickup truck plants first, I’ll be standing here in line saying ‘send me all you can get.’”
GM Mexico reopened its engine and transmission plants in the cities of Ramos Arizpe and Silao on Thursday.
Bloomberg contributed to this report.