Who is buying all of these Silverados? There is such strong demand in spite of the coronavirus pandemic that GM truck factories will begin three shifts starting June 1. Until now only one shift could make Chevy and GMC pickups because of outside supplier issues. Both GMC and Chevy dealers have been panicking due to low inventories. Silverado and Sierra models have some of the highest margins of anything GM makes. The coronavirus just can’t stop Chevy truck demand.
AutoNation is the largest US new-car retailer. According to Automotive News, Mike Jackson, CEO of AutoNation Inc., in an interview said he was anxious to build up low inventories of Silverados. “If they can restart the pickup truck plants first I’ll be standing here in line saying ‘Send me all you can get,”’ he said.
GM truck sales were off to a slow start in 2019
Things didn’t start off well for the redesigned Chevy/GMC pickups. Sales were off to a slow start in 2019, especially for Silverado trims. GM claimed it was because it built a range of trucks to be available at launch so that cut into Silverado production.
GM pickups began showing up on dealership lots in August 2018. By mid-2019 Chevy truck sales had slipped to third place behind Ford and Ram. Then in September, the UAW strike stopped all GM production for 40 days.
When production resumed in October GM got in a few more months of production before everything was halted for the coronavirus. Now it is just ramping up production again after two months of downtime. GM originally wanted to add a second shift of truck production mid-May. Unfortunately, outside supplier issues meant there were only enough parts to satisfy one shift a day.
The lack of wiring harnesses kept factories from launching three shifts
Specifically, 80% of truck wiring harnesses are manufactured in Mexico according to the Detroit Free Press. But Mexico shut down manufacturing just as was done in the US. Then it got a late start in ramping up production which put off the three-shift assault expected May 26.
There are three GM factories that build mid- and full-size pickup trucks. The Flint, Michigan truck plant which just finished a $150 million upgrade to increase Silverado and Sierra HD production. At Fort Wayne, Indiana, 2019 crew-cab model assembly started in July 2018 with double-cabs starting later in October. Regular-cabs and crew-cabs started production at the Silao, Mexico, plant at the beginning of 2019.
Extra safety measures and protocols help protect workers from the coronavirus
There have been extra safety measures and protocols added to help protect workers from the coronavirus. In a statement GM said, “Our comprehensive safety procedures are working well, and our suppliers have done a great job implementing their return-to-work strategies and safety playbooks.”
Other GM plants plan on increasing to two shifts soon, then three to fill out other lines. But GM’s emphasis on trucks and three shifts is an indication of just how much demand there is. It said there are strong customer and dealer demand for pickups. With a full-blown pandemic over the past several months, sales of full-size trucks never dipped below 25%.