Orders for GM's '05 models down

DETROIT, Aug. 20 (UPI) -- General Motors is facing reduced orders for 2005 model year vehicles and has cut its North American production, the Wall Street Journal reported Friday.

Some large automotive retailers and car dealerships, overloaded with unsold vehicles and worried that discounts as large as $6,000 are not working, are scaling back their orders for GM's 2005 models.

"We are being very cautious and scaling back our 2005 orders to clear out our long position on these 2004 models with big incentives," said B.B. Hollingsworth Jr., chairman and chief executive of Group 1 Automotive Inc., a Houston retailer with 91 dealerships.

GM said it hasn't noticed a big scale-back in orders, but has trimmed North American production this quarter by 5 percent from a year ago, said Paul Ballew, GM's executive director for market and industry analysis.

He said GM would also "stay aggressive" on its incentive offerings and should benefit from a stronger economy in the second half.