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Northstar

GM moves to accelerate production of key SUVs

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Northstar    11

Reuters / March 15, 2006 - 4:00 pm

DETROIT -- General Motors, encouraged by the early sales of its redesigned 2007 Chevrolet Tahoe SUV, is accelerating its production schedule by several weeks for other SUVs built on the same platform, a spokesman said on Wednesday.

GM is also asking its parts suppliers to ship components ahead of schedule so it can move to production more quickly for new versions of full-sized SUVs such as the Chevrolet Suburban and the GMC Yukon XL.

The moves are key since the success of GM's revamped line of SUVs represent the struggling automaker's most important product launch this year, in a profitable segment of the market that it has long dominated.

Sales of the Tahoe, which offers better fuel economy and a more powerful engine than the model it replaced, were up almost 50 percent in the first two months of 2006 from a year earlier to over 28,500 vehicles.

The new SUV was launched in January amid concerns that high gasoline prices and a consumer backlash against SUVs could dampen sales of the new GM models, also known as the GMT900 series for the platform they share.

"From a production standpoint, things are going very well. We've pulled up production of the Suburban and the Yukon XL by a few weeks," said GM spokesman Dan Flores. "The launch of the Tahoe has been very strong. The demand has been very strong."

Production of Chevy Suburbans will start next week at GM's plant in Silao, Mexico. A second factory in Arlington, Texas, which makes the GMC Yukon and Yukon XL, is several thousand vehicles ahead of an earlier production schedule, Flores said.

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