GM Hits Pause On Full-Sized Pickup Production For Four Weeks In Silao

Production of the best-selling combo of vehicles in the US has just been put on hold. A new report says that General Motors is planning to stop production of the GMC Sierra and the Chevrolet Silverado pickups at its assembly plant in Silao, Mexico. While production stoppages, especially in the summer, are not unusual, this extended shutdown seems like it could be something different. When combined, the mechanically identical Silverado and Sierra outsell Ford’s F-Series, America’s best-selling vehicle for decades now.

Reuters first reported that production of the full-sized trucks at GM Silao had been paused for the first two weeks of July. The same report suggested that production at the plant was set to be idled once again for two weeks, this time in early August. It cited two sources familiar with the matter.

GM Calls Stoppage Standard Process

In response, GM said that “scheduled down weeks at GM Silao are part of a standard operating process focused on optimizing production at our manufacturing complex.” It is common for automakers to press pause on a plant for maintenance or model year changeovers. Many of GM’s plants, Reuters reports, were also not operating in relation to the July 4 holiday.

Pausing for a total of four weeks, though, is more unusual. Especially with GM’s full-size truck sales at their highest in 20 years. The Sierra had its best first-half ever, while the Silverado HD was up 19 percent.

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GM does build its full-size trucks at three other plants. Silverados and Sierras are assembled in Fort Wayne, Indiana, and Flint, Michigan. The Silverado and Silverado HD are also assembled at GM’s Oshawa Assembly in Ontario, Canada.

Why Would A Plant Stop Production?

There are multiple possibilities why GM might want or need to press pause at the plant. These include possible labor issues, supplier delivery problems, or even the need to replace, repair, or add to equipment at the plant. Tariffs could also be a big issue here; President Trump has announced a 30% tariff with Mexico starting August 1. Exactly how that affects automakers participating in the US Mexico Canada trade agreement still isn’t entirely clear. But the plant closure lines up with the tariff bump.

It’s also possible GM is being affected by the supply shortage of rare earth metals that is disrupting the industry. Ford and others have raised concerns about China’s slow pace to issue export licenses for the materials. This has led to brief pauses at other automakers’ plants.

We also know that GM has plans to change production of its full-sized pickups. It said earlier this year it intended to spend significant sums to start production of full-sized trucks in Orion Township, Michigan. In May, GM announced it would be cutting one shift at its Oshawa plant, laying off around 750 workers. Those cuts are set to happen in November. GM plans to add production at its Fort Wayne plant, but that increased capacity has not yet come online. It’s also possible, and this has happened before, that they are just building too many trucks. Taking a few weeks off can help balance inventory.

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In June, GMAuthority reported that GM had no plans for closures or layoffs at its extensive Mexican manufacturing facilities. These plants build vehicles like the gas and electric Chevrolet Equinox and Chevrolet Blazer, as well as the Cadillac Optiq, and GMC Terrain.

Sources: GMAuthority, Reuters