said it will halt production of the Chevrolet Volt for five weeks because inventories are too high.
The automaker has told 1,300 employees at the Detroit-Hamtramck assembly plant of the planned March 19 through April 23 shutdown, according to published reports.
The shutdown comes despite the recent news that GM has begun shipping low-emission Chevrolet Volts to California, where drivers will be able to drive them in the state's car-pool lanes.
Volt sales fell to 603 in January, down from 1,529 in December, the highest monthly total ever. In February, sales recovered to 1,023. In 2011, GM sold 7,671 in 2011.
"The fact that GM is now facing an oversupply of Volts suggests that consumer demand is just not that strong for these vehicles," said Edmunds.com analyst Lacey Plache, in a prepared statement. "The price premium on the Volt just doesn't make economic sense for the average consumer when there are so many fuel-efficient gasoline-powered cars available, typically for thousands of dollars less."
The car is currently priced around $41,000, although tax incentives are available, apparently not enough to stimulate sales sufficiently even though gas prices have been rising.
Volt dealer stock is 3,596 units, Alan Batey, vice president of Chevrolet sales and service, said on the GM sales conference call Thursday.
Sales fell after regulators said in November that they were conducting a safety investigation because a crash test led, three weeks later, to a battery fire. That investigation was halted after the automaker made modifications in the frame protecting the battery. Volt sales totaled just 603 in January, down from 1,529 in December.
The inability to qualify to be driven in California car-pool lanes has been a drag on Volt sales, given that California is the largest auto market and its drivers are particularly prone to buy fuel-efficient cars.
-- Written by Ted Reed in Charlotte, N.C.
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