GM Plans 21 Idle Weeks in 2012 - Analyst Blog

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General Motors Co. ( GM ) announced that it will idle 21 weeks at three of its pickup truck plants in the U.S. in 2012 for upgrades and renovations as the automaker is preparing to assemble next generation trucks, which will be introduced in 2013.

The plant idling schedule includes suspension of production for 9 weeks at GM's Fort Wayne assembly plant in Roanoke, Indiana from January to October; 7 weeks at Flint, Michigan plant from June to November; and 5 weeks at Arlington, Texas plant from June to December.

So far, Chevrolet Silverado and GMC Sierra are the two most profitable pickup truck models of GM. Last month, GM's sales grew 6.9% to 180,402 vehicles, driven by strong demand for both cars and trucks. Sales of the Silverado pickup truck surged 33.7%, while that of Tahoe SUV soared 32.8%.

A few days back, GM announced that it will invest $68 million at its Oshawa, Ontario assembly plant in Canada for manufacturing the new version of the Chevrolet Impala on top of an investment of $117 million announced by the company previously for producing the CadillacXTS at the same plant in 2012.

Apart from Canada, GM announced in May this year that it would invest a total of $2 billion at 17 assembly and components plants in 8 states for 18 months in the U.S. Through the investment plan, the automaker intends to create or preserve more than 4,000 hourly and salaried jobs at the plants.

So far, facilities that received investment under the same plan include Kansas City, Kansas; Bowling Green, Kentucky; Arlington, Texas; Bay City, Detroit; Flint, Lansing; Warren, Michigan; Toledo, Ohio; Bedford, Indiana; Wyoming, Michigan; Buffalo, New York; and Spring Hill, Tennessee.

GM, aZacks #3 Rank (Hold) company, posted an 11% decline in profit to $1.74 billion in the third quarter of the year from $1.96 billion in the same quarter of 2011. Nevertheless, on a per share basis, the profit of $1.03 was higher than theZacks Consensus Estimate of 99 cents and compared with $1.20 in the third quarter of 2010.

The decline in profit during the quarter was attributable to lower interest income and other non operating income (net), loss on extinguishment of debt and income tax expense.

Meanwhile, GM's crosstown rival Ford Motor Co. ( F ) posted a $66 million or 3.5% fall in profit to $1.85 billion in the third quarter of the year from $1.91 billion in the same quarter of prior year. However, on per share basis, earnings were 46 cents versus 48 cents a year ago, beating theZacks Consensus Estimate of 44 cents. The decrease in profit was attributable to anticipated reductions in Financial Services results.


 
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GENERAL MOTORS ( GM ): Free Stock Analysis Report
 
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: F , GM

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