The issues of reduced demand and the subsequent high inventories for the Cadillac ATS and CTS resulted in parent company GM cutting one shift from its Lansing Grand River Michigan plant in Michigan.
Company spokesman Bill Grotz confirmed to Autonews that this move means about 350 workers will be laid off as of January, with some of them being relocated to one of GM’s other plants in the region. It will also result in the Michigan plant operating on just one shift.
The decision was taken after sales of the ATS and CTS fell way short of company projections. As a result, on November 1 there was a 151-day supply of ATS and 113-day supply of CTS cars on their way to dealers – and that’s after some heavy incentives offer last moth to help move the cars out of the dealerships.
New Cadillac chief Johan de Nysschen wants to cut production so that supply keeps up with demand, meaning that the brand will keep its exclusivity and won’t have to resort to discounts that may hurt its image.
“Either you have to bring your volume aspirations into alignment with reality and accept that you will sell fewer cars, or you have to drop the price,” de Nysschen told Automotive News in September. “It’s better to build off a very solid base in terms of product credibility, charge a fair price for the car, and realize you have to wait until the volume comes”, he added.
US sales of the ATS were down by 19 percent over the first nine months of the year compared to 2013, while the CTS fared better with only a 2 percent drop.
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