The Chevy Cruze was supposed to be a bellwether for the overall health of Government General Motors. If so, things are not looking as rosy for the 2012 model year as they did for the 2011 model:
Ever since emerging from bankruptcy, the Chevrolet Cruze has been something of a symbol of GM’s rebound. Widely hailed by the automotive media as General Motors’ strongest effort to date in a compact segment that has become increasingly important in recent years, the Cruze seemed to show that the “new” GM was capable of selling smaller cars on their merits, rather than as afterthoughts to more profitable truck, SUV and large car offerings. And indeed, through the first half of this year, it seemed that the Cruze was something of a roaring success, regularly outselling its segment competitors. But then, in June, when production shifted from 2011 models to 2012 models, something changed: sales started to slow, and inventories started to rise. As Cruzes began piling up on dealer lots, GM trimmed production moderately, but still, inventories began to grow out of control. Clearly something was going wrong.
Last week, GM shut down production of the Cruze, saying only that it had an unspecified “supplier issue.” But Automotive News [sub] reports that had already GM shut down the Lordstown plant for the entire week of November 28, after inventories shot from 33 days supply to 73 days supply during the months of September and October. As of December 1, inventories had risen higher still, to 88 days, as sales continue to slacken. Lordstown reopened yesterday, but with sales falling and inventories running out of control, another slowdown or stoppage of production seems inevitable.
