GM <GM> SAID TO CUT 2ND QTR OUTPUT SCHEDULES
General Motors Corp has cut 100,000
cars from its second quarter production schedule, according to
Automotive News.
    The trade paper, citing "sources both within GM and on the
outside," said GM plans to build 1,042,708 cars in the quarter,
a nine pct reduction from its earlier estimate. The cut could
lead to further layoffs at GM, it said.
    A GM spokesman said the company does not disclose future 
production schedules.
    Auto analysts said the cut would make sense for GM, which
has high car inventories.
    A 100,000-car reduction in output would only take GM part
of the way toward reducing high inventories, said Ron Glantz,
analyst with Montgomery Securities.
    "They should be cutting a lot more than they are," Shearson
Lehman analyst Michael Lucky said. He estimated that, even if
GM cut an additional 100,000 cars from its second quarter
production, it would still have a 75-day supply of cars.
    Normal inventory level is 50 to 65 days supply. At the end
of March, the automaker had 95 days supply, Lucky said.
    Glantz said that at the end of February GM had 361,000
excess vehicles, including both cars and trucks.
    The production cuts could lead to increased layoffs,
although those would likely be temporary rather than indefinite
layoffs, said Lucky.
    He said the automaker might also use this as an opportunity
to close some plants. Lucky estimates that GM needs to shut two
or three more assembly plants to bring its capacity more in
line with demand.
 Reuter
