DETROIT -- General Motors plans to shut five U.S. auto assembly plants for varying durations in January, primarily to cut oversupply of sedans which have fallen out of favor among U.S. consumers.
GM confirmed today information from sources at the UAW who said that the five plants will shut.
Automotive News reported on Dec. 11 on GM's growing inventory concerns, suggesting production cutbacks would be coming soon.
In October, when it reported third-quarter earnings, GM said it has increased its U.S. dealer inventory by 111,000 vehicles.
GM as of Dec. 1 had 86 days' supply of U.S. inventory of new vehicles, up from 84 days on Nov. 1, according to the Automotive News Data Center. Inventory stood at 70 days on Dec. 1, 2015.
GM said that days supply figure would "fluctuate before moderating at year-end." A company spokesman said on Monday that it is targeting about 70 days of inventory.
Several Wall Street analysts, including Brian Johnson of Barclays, have said that if GM plants close to level out its inventory, it would pressure GM shares.
Shut for three weeks will be the Detroit-Hamtramck plant in Michigan and the Fairfax factory in the Kansas. Down for two weeks will be the Lansing Grand River plant in Michigan, and down for a single week each will be the Lordstown plant in Ohio and the Bowling Green factory in Kentucky.
In November, GM announced the layoff of about 2,000 workers with the suspension of third shifts at the Lordstown and Lansing Grand River plants, also in January.
The Lordstown plant builds the compact Chevrolet Cruze, and the Lansing plant manufactures the Cadillac ATS and CTS. Sales of each of those models are down about a fifth from year-ago sales.
The January shutdowns were reported earlier by The Detroit News.
Automotive News contributed to this report.
