GM 'plans temporary factory closures'

General Motors Corp is planning to temporarily close most of its US factories for up to nine weeks this summer because of slumping sales and growing inventories of unsold vehicles, sources said.

Analysts said the company could be seeing sales decline because of talk about a potential bankruptcy.

The exact dates of the closures are not known, but the sources said they will occur around the normal two-week shutdown in July when changes are made from one model year to the next.

GM spokesman Chris Lee would not comment other than to say the company notifies employees before making any production cuts public.

Some of the closings could be staggered between mid-May and the end of July, but the exact number of plants to be idled has not yet been determined.

A few plants that make more popular models could remain open for part of the shutdown period, but at reduced assembly line speeds.

Thousands of workers could be laid off but would still get most of their pay because their United Auto Workers union contract requires the company to make up much of the difference between state unemployment benefits and their wages.

UAW officials at several factories said they have meetings scheduled today and tomorrow with plant managers and GM human resource officials to discuss production changes.

The shutdown could be catastrophic to many car parts suppliers that already are near bankruptcy due to previous production cuts.

During the shutdown, suppliers could not ship parts to GM and would lose critical revenue.