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GM Investing $24 Million in Indiana Plant to Boost Pickup Truck Production

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【Summary】​For General Motors, pickup trucks and SUVs are a highly profitable segment and the company is working to ramp up production. The Detroit-based automaker said on Thursday it would invest $24 million to increase truck production at its assembly plant in Fort Wayne, Indiana. The plant builds the popular Chevrolet Silverado and GMC Sierra pickup models.

Eric Walz    May 30, 2019 2:10 PM PT
GM Investing $24 Million in Indiana Plant to Boost Pickup Truck Production
A GMC Sierra pickup on the assembly line at GM's Fort Wayne Assembly plant Tuesday, May 14, 2019. (Photo: GM)

For General Motors, pickup trucks and SUVs are a highly profitable segment and the company is working to ramp up production, despite the growing number of more environmentally friendly hybrids and fully-electric zero-emission cars being introduced by rival automakers.

The Detroit-based automaker said on Thursday it would invest $24 million to increase truck production at its assembly plant in Fort Wayne, Indiana. The plant builds the popular Chevrolet Silverado and GMC Sierra pickup models.

The investment will boost the plant's conveyors and other tooling to support the increased production, mainly the bigger crew-cab versions of the trucks the company said.

The investment in the Fort Wayne plant will not only help the automaker boost output of its popular truck models, but may also offer an opportunity for some of the workers displaced by the March closure of GM's assembly plant in nearby Lordstown, Ohio.

The Ohio plant produced the Chevy Cruze sedan until GM decided to end production in March. In Nov 2018, GM said it will no longer sell the Cruze in North America due to dwindling demand for sedans in general. GM announced also announced it would discontinue the Impala and Chevy Volt sedans.

The shuttered Lordstown plant was thrust into the national spotlight when President Trump incorrectly stated earlier this month that the facility was being sold to a electric vehicle startup Workhorse Group, and that GM was making a new investment in the state and bringing back jobs.

GM was also chastised last year for electing to build the 2019 Chevy Blazer SUV in Mexico instead of the U.S.

GM CEO Says the Investment is Necessary to Keep Up With Demand

GM Chief Executive Officer Mary Barra said the investment in Indiana is necessary to keep up with demand, as consumers move away from buying sedans in favor of SUVs, pickups and smaller crossovers.

"We are building Chevrolet and GMC crew cab pickups at record volume and mix levels to meet customer demand and the $24 million investment will allow us to build even more," said GM Chief Executive Officer Mary Barra. She added, "Crew cab sales have been very strong, and we are expanding customer choice with new models, more cab choices and innovative new powertrains."

Combined sales of the Chevrolet Silverado 1500 and GMC Sierra 1500 crew cab pickups, which launched in the second half of 2018, were up 20% in the first quarter of 2019 versus a year ago. GM is projecting another significant increase for the second quarter.

In response to changing market demand, GM has previously made changes over the years to support truck and SUV production, which represent a significant portion of its annual profits.

GM's Arlington, Texas assembly plant for example, has been operational since 1954, churning our passenger cars for Buick, Cadillac and Chevy. However the plant was converted in 1997 to produce only trucks—and still does today.

In 2015, GM announced it was investing $1.4 billion into updating and retooling its Arlington assembly plant, which was preceded by adding an all-new stamping facility in 2013.

More recently, in Feb 2019 GM announced that its factory in Flint, Michigan was adding 1,000 workers to build new heavy-duty pickup trucks there.

GM said it has invested more than $1.2 billion in the Fort Wayne, Indiana plant since 2015.

Since 2009, GM said it has invested $23 billion in U.S. manufacturing.

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