GM wants to miss some sales in the name of profits

Article by Christian Andrei, on August 26, 2010

Apparently, General Motors Co. is prioritizing profit over sales as it raises the output from its existing plants rather than restarting idle plants. GM does this despite signs that the economy will recover this year and that GM's forecast could be exceeded. Dealers are also coping with the fact that it doesn't have as many ready-to-sell vehicles in their lots.

GM used to keep factories operating at all costs. GM has seen the advantages of having lean inventories. 

These include low incentives; better brand values; and annual profits. Mike DiGiovanni, GM's top sales analyst, said that in the short-term, the tighter alignment of production and demand could cost a few sales but that eventually, it will build the brands.

By doing so, the residual values will go up, people will pay more for the cars and this will also enhance the image of the brand, making it gain more market share.

To cope with demand while at the same time keeping costs to a minimum, GM will by spring have five of its 16 operational North American plants working at more than a 100% capacity with two standard shifts, five days per week. [via autonews]

Topics: gm, profit

If you liked the article, share on:


Login or Create new account to add a comment!


It wasn’t too long ago when Maserati took the wraps off what appears to be the most gorgeous concept coupe ever made. The Alfieri coupe premiered at the 2014 Geneva...
by - October 23, 2016
Many have been excited with the impending arrival of the next-generation Jeep Wrangler and the new 2019 Jeep Grand Wagoneer, which is slated to be the brand’s new range-topping model....
by - October 21, 2016
Chevrolet has taken the wraps off its new Chevrolet Colorado ZH2 at the fall meeting of the Association of the United States Army (AUSA). Tagged as the most extreme fuel-cell-powered...
by - October 21, 2016
Honda has unveiled the fifth generation of its hot-selling SUV – the 2017 Honda CR-V. The latest iteration of the CR-V should help it maintain its benchmark status in the...
by - October 21, 2016
Many are already expecting BMW to launch an ultra luxurious SUV that will serve at its new flagship by late 2018. Larger than the X5 and X6, the new X7...
by - October 21, 2016