GM to cut output by 50,000 vehicles in 4th quarter

November 05, 1994|By Bloomberg Business News Sun staff writer Ted Shelsby contributed to this article.

DETROIT -- General Motors Corp. said yesterday that it plans to cut fourth-quarter production in the United States and Canada by almost 50,000 cars and trucks, blaming the effects of material shortages and a strike as well as a slow build rate for new vehicles.

GM has ratcheted down production forecasts steadily since September. Yesterday's estimate marks a cut of another 14,000 from its early October estimate of 1,420,131 vehicles.

Plans now call for GM to make 1,406,138 cars and trucks at its U.S. and Canadian assembly plants in the fourth quarter. That's down from its original fourth-quarter forecast of 1,456,111 cars and trucks, which was made in early September.

Spokesman John Shea declined to say how many mid-size Chevrolet Astro and GMC Safari vans GM plans to produce at its Southeast Baltimore plant during the final quarter of the year.

"We don't break down estimates by individual plant," he said.

According to officials of United Auto Workers Union Local 239, which represents about 3,400 hourly workers at the local plant, the assembly lines were slowed in recent weeks by a shortage of transmissions due to a strike at a parts plant in Flint, Mich., last month, but the plant is scheduled to begin working two hours of overtime on each shift beginning Monday.

Mr. Shea said GM lost about 15,000 vehicles' worth of production because of the Flint strike. He said the effects of that strike spilled over into the fourth quarter.

Mr. Shea also said GM's forecast was lowered because of material shortages and slower-than-anticipated production start-ups needed to ensure quality. Recently, the automaker posted a third-quarter loss of $328 million in its North American vehicle operations, slipping back into the red after earning $723 million in that critical segment in the previous quarter.

GM has struggled with slow starts for its new Cavalier and Sunfire cars at its Lordstown, Ohio, plant.

Its Arlington, Texas, plant, which makes large sedans and wagons, was forced to halt assembly this week because of a shortage of transmissions.

Still, GM's latest fourth-quarter estimate is up 4.9 percent from the final quarter of 1993, when the automaker's U.S. and Canadian plants churned out 1,339,470 cars and trucks.

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