Consumer Demand Pushes GM Vehicle Sales Up 40% Despite Chip Shortages, Pandemic Fears

Sales of General Motors (GM) vehicles were up 40% for the second quarter of 2021 despite the challenges of the COVID pandemic and production disruptions caused by semiconductor chip shortages.

Overall, GM reported that it sold 688,236 vehicles in the second quarter, which it said was spurred by strong customer demand.

“The U.S. economy is accelerating, consumer spending is robust and jobs are plentiful,” Elaine Buckberg, GM chief economist, said in a statement. “Consumer demand for vehicles is also strong, but constrained by very tight inventories. We expect continued high demand in the second half of this year and into 2022.”

Strong sales were seen with GM’s Buick brand, with a 86% spike in sales as the new Encore GX, Envision, and Enclave were released. The GMC brand also fared well, recording its best second quarter since 2005, fueled by the Yukon line.

The Chevy Silverado and GMC Sierra pickup trucks a combined sales increase of 36% for the quarter, with the light-duty posting strong gains, GM said. More than 237,00 Silverados and Sierras were sold by GM, earning it 40.6% of the retail marketing for full-size pickup trucks, the company said.

Cadillac also saw its best quarter since 2015, and the Chevy Bolt EV also had a record quarter.

To further cement its position in the automotive market, GM said that it is increasing the production of its HD pickup trucks by 1,000 units a month, starting in mid-July at its Flint Assembly plant in Michigan. The automaker is also returning full-size truck production to the Oshawa Assembly plant in Canada at the end of 2021.

In addition, shipments of the Chevy Colorado and GMC Canyon mid-size pickup trucks will increase by 30,000 units, starting in mid-May through early July at its Wentzville Assembly plant in Missouri as the vehicles undergo dynamic testing after being held for chip shortages.

Regarding the chip shortage that all automakers are struggling with, Kurt McNeil, GM U.S. vice president, Sales Operations, said, “ Although the situation remains fluid, we’re focused on continuing to leverage every available semiconductor to build and ship our highest demand products.”

Currently, GM has 211,974 units in inventory, down from 334,628 at the end of the first quarter, it said.

Shares of GM were trading at $59.06 as of 1:14 p.m. ET on Thursday, down 11 cents, or 0.19%.