Rising gas and diesel prices haven’t slaked the thirst for General Motors’ heavy-duty pickups, forcing the company to increase production of its Chevrolet Silverado and GMC Sierra HD trucks.
Beginning in June, GM plans to shift production, already at three shifts in the Flint Assembly Plant in Michigan, to five days to six days a week, according to a report by the Wall Street Journal. The plant currently builds about 1,100 of the 2500 and 3500 versions of the Chevy and GMC full-size trucks daily.
The company does build those trucks at its Oshawa Assembly Plant in Ontario, Canada, but tariffs on those trucks makes it cost prohibitive to build them there versus paying overtime at the Flint plant. GM told the WSJ the increased production in Flint isn’t pulling any from Oshawa.
GM officials said the reason for the production increase is simple: to meet demand. The automaker’s happy to churn out more heavy-duty trucks because they are highly profitable.
The war with Iran has caused gas and diesel prices to jump significantly. The average price of gas is now $3.95 per gallon, having risen 2.4 cents in the last week. However, according to GasBuddy.com, it’s risen 97.9 cents during the past month, and 83.8 cents from a year ago at this time.
Diesel prices are up too with the national average price of diesel rising 14.3 cents in the last week, to $5.369 per gallon, the highest level since July 27, 2022.
“Gasoline and diesel prices continue to climb to multi-year highs as the effective closure of the Strait of Hormuz curtails the flow of millions of barrels of crude oil each day,” said Patrick De Haan, head of petroleum analysis at GasBuddy.
“The situation remains highly volatile and unpredictable, but upward pressure on fuel prices is likely to persist as long as global oil supplies are constrained by the continued disruption in the Strait. We’re likely to see the national average for gasoline push beyond the $4-per-gallon mark, while diesel could approach $6 per gallon and potentially set new records if conditions fail to improve.
“Americans have already spent nearly $8 billion more on gasoline over the past month, a trend that poses growing risks to the broader economy, while surging diesel prices may begin to reaccelerate inflation.”
[Images: GM]
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