GM Extends Plant Shutdowns Amid High Vehicle Inventories

General Motors hopes to combat rising vehicle inventories by extending production shutdowns at several North American factories.

Reuters reported this week that the Orion Assembly plant outside Detroit will remain offline for longer than previously announced. The factory joins facilities in Lordstown, Ohio, Kansas City, Kan., and Oshawa, Ont., that previously saw summer shutdowns extended.

More than 9,400 GM employees will be impacted by temporary rolling layoffs this summer, according to the report. The automaker's inventory last month reached a supply of 105 days — the highest in 10 years — and GM previously indicated plans to trim the level to 70 days by the end of the year.

The production slowdowns could affect the company's revenue — and profits — and high inventory levels could also erode profits if dealers offer discounts to clear crowded lots.

Although GM expects its 2017 sales to fall just below the record set last year, those plants primarily make Chevrolet passenger cars, whose sales struggled as drivers instead turned to larger trucks and SUVs.

The Lordstown and Kansas City plants produce the Cruze and Malibu, respectively, while the Ontario plant assembles the Impala.

Orion, meanwhile, produces the Chevrolet Sonic and the new Bolt, the first plug-in electric vehicle priced at about $35,000 that’s capable of traveling more than 200 miles on a single charge.

The Bolt's inventory of 111 days' supply is higher than the company's overall, but officials attributed the expanded Orion shutdown to a steep decline in sales of the Sonic.

The electric car is expected to be available in all 50 states by next month — just after electric vehicle pioneer Tesla delivers the first of its mass-market Model 3 sedans to customers.