General Motors Corp's head of North American operations said on April 04 that he expects second-quarter sales to be softer than initially forecast due to a weaker overall industry than GM had anticipated.
Speaking on the sidelines of the New York International Auto Show, Troy Clarke said the automaker was scaling back production on some cars and mid-size sport utility vehicles to cope with softer demand. "We thought the market would be stronger," he said.
The US auto industry is expected to be slightly weaker this year as a softer economy, high interest rates and pressures on the subprime mortgage market dampen demand for new vehicles.
GM's US sales fell 7.7 percent in March, driven by big declines in sales of pickup trucks and sport utility vehicles. Sales of GM's Chevrolet Silverado pickup fell 12 percent, while GMC Sierra purchases were down 18 percent in March.
GM, which is in the middle of a sweeping restructuring that includes more than 34,000 job cuts and 12 plant closures, has been sticking to a strategy of lower-but-clearer pricing with few incentives as part of its turnaround.
For decades, the world's largest automaker has been known for a complicated pricing system that offered big, profit-reducing incentives.
GM's Sales Chief, Mark LaNeve, said the automaker's pricing, incentive and marketing strategies have helped stabilised retail sales at a seasonally adjusted annual rate, or SAAR, of about 3 million units. LaNeve said GM plans to increase incentive spending on full-size pickup trucks in 2007.