General Motors’ new approach is shown in how it is handling the inventory of the Chevrolet Cruze, which is currently the top-selling compact and belongs to the Top 10 sellers. In late November, GM announced that the Cruze plant in Lordstown, Ohio, will be idled for one week to tamp down the growing inventory.
This is a refreshing move because the old GM (before its bankruptcy in 2009) would have overproduced the model and then offered profit-dwindling discounts.
What GM is focused on now are higher prices, better residual values and bigger margins. GM North America President Mark Reuss said that what GM would have done in the past was to “blow through those production schedules and keep [the plants] on.” Dave Green, president of UAW Local 1714, said that this move signifies how different the company is now.
UAW Local 1714 represents workers at GM's stamping plant in Lordstown. He said that in the past, there would be a 150-day supply but there would still be Saturday shifts. He revealed that even its membership believes that this is not the same GM. In the past, the automaker would have overproduced so that it could generate revenue at any cost but in the new G, the legacy costs and the operating costs are reduced.