Here's Why General Motors Is Closing 5 U.S. Plants In January

U.S. auto giant General Motors GM confirmed on Monday that it will be closing five U.S. assembly plants for one to three weeks next month, mostly to trim the oversupply of sedans and other passenger cars as more and more consumers prefer trucks and SUVs

Just over 10,000 workers will be idled, and workers at these plants will receive supplemental pay and unemployment benefits that will add up to most of their pay.

According to the Detroit Free Press, GM’s Detroit-Hamtramck and Fairfax, located in Kansas, plants will be closed for three weeks; its Lansing, Michigan factory that builds that Cadillac CTS and ATS will be shut down for two weeks; and GM’s plants in Lordstown, Ohio and Bowling Green, Kentucky, which builds the Chevy Cruze and Corvette, respectively, will be down for one week.

GM had recently increased its total inventory, but will be cutting back on that supply at the end of its current year. During its third-quarter earnings report, the company said its U.S. dealer inventory was up by 111,000 vehicles.

Even though GM is trying to cut its car inventory, the company will be keeping its pickup plants in Flint, Michigan and Fort Wayne, Indiana at full production on multiple shifts throughout January; pickups, vans, SUVs, and crossover vehicles made up around 62% of all vehicles sold in the U.S. in November. Low gas prices have likely helped this surge in truck and SUV sales, as well as increased fuel efficiency.

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