General Motors to close four truck plants, consider sale of Hummer

With its May sales volume dropping about 28% amid surging fuel prices and a weak U.S. economy, General Motors Corp. said today that it would close four truck plants, prepare its Hummer brand for a possible sale and focus on making smaller cars.

GM Chairman Rick Wagoner said the world's largest automaker believed that American consumers were shifting permanently from sport utility vehicles and toward smaller vehicles. He said the company's board had greenlighted production of a new small car in an Ohio factory and of its Volt electric vehicle -- set to debut in 2010 -- in Detroit.

"We at GM don't think this is a spike or a temporary shift," Wagoner said in a morning conference call. On Monday, the average for a gallon of regular gasoline reached $3.98 nationally and $4.24 in California.

GM said it would close plants in Oshawa, Canada; Moraine, Ohio; Janesville, Wis.; and Toluca, Mexico. Several thousand jobs could be affected. Those plants are responsible for pickup truck and SUVs such as the Chevrolet Silverado, the GMC Envoy and the medium-duty Chevy Kodiak and are expected to end production no later than the end of 2009.

The GM news came on the day all automakers are set to announce their May U.S. sales results. The month is expected to be brutal for all manufacturers, even when compared with a tepid April, which saw sales decline by 7% overall.

Toyota Motor Corp. reported that its sales slipped 4.3% in May, after a 3.3% year-over-year decline for April. On the year, Toyota sales, which include the Lexus and Scion brands, are down 3.5%.

Although Toyota has hot-selling smaller cars such as the Yaris and hybrids like the Prius, the Japanese automaker, like GM, also has a large array of SUVs and pickups, none of which are selling well in the current environment.

Ford Motor Co. said its sales declined 16% on the month, dragged down by a 41% drop for its Explorer SUV and a 31% decrease in sales of the F-Series pickup, the top-selling vehicle in the country.

Other companies will release results throughout the day.

For GM, pickups and SUVs have been deeply problematic for some time. But by far its worst division has been Hummer. Through April, Hummer was the worst-performing vehicle brand in the country, with sales down 29.6% from a year earlier, putting it below runners-up Mercury, Chrysler and Bentley.

"At this point, we are considering all options for the Hummer brand," Wagoner said. "Everything from a complete revamp of the product lineup to partial or complete sale of the brand."

No possible buyer has been named for the division, which was for a few years -- when gasoline cost less than $3 a gallon -- one of GM's strongest. Last week, GM stock hit a 26-year low, falling to $17.38. At 11:15 this morning, the stock was unchanged at $17.43.

Chrysler, which is viewed as among the most troubled of automakers, has denied persistent rumors that it would sell its Jeep brand, itself down 13% through April.

Volkswagen said its sales for the month were essentially flat, with a less than 1% increase.

ken.bensinger@latimes.com