GM to run auto plants overtime to cash-for-clunkers demand

General Motors said Tuesday that it's ramping up end-of-the-year production to meet an increase in demand fueled by the government's cash-for-clunkers program.

The automaker, which spent about six weeks in bankruptcy court this summer after falling car sales left it on the brink of collapse, will add shifts and run some plants on overtime to increase production by 60,000 vehicles by the end of the year.

"The uptick is an encouraging sign that vehicle sales are turning around, and we will ramp up quickly to meet that demand," said Tim Lee, GM group vice president of global manufacturing and labor.

The automaker is increasing production at the Lordstown, Ohio, plant that makes Chevy Cobalt compact sedans and the Ontario plant that makes the new Chevy Equinox and GMC Terrain crossover vehicles. Third-quarter production will be up 35% over the second quarter, and fourth-quarter production will be 20% higher than in the third quarter.

GM said the Chevy HHR wagon and Chevy Colorado and GMC Canyon small pickups also are in higher demand. New vehicles including the Chevy Camaro, Cadillac SRX crossover and CTS Wagon and the Buick LaCrosse sedan are getting good initial reactions, GM says, and may benefit from higher production as well.

Last week, Ford announced it's increasing production by 26% in the second half of the year as well to help meet demand for its Ford Focus sedans and Ford Escape small SUVs.

But some industry watchers say cash-for-clunkers demand already is waning. Shopping site Edmunds.com said Tuesday that buyer interest is down 31% since its peak in July. The program gives buyers up to $4,500 rebates if they buy a more-fuel-efficient model. Buyers feared the rebate money would run out in July and rushed to dealers.

"Now that there is plenty of money in the program and the most eager shoppers have already participated, the sense of urgency is gone, and the pace of intent decline is accelerating," said Edmunds.com CEO Jeremy Anwyl.

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