US gasoline hits record; GM cuts truck capacity

The average regular gasoline prices in the nation reached a record $3.607/gal , according to AAA, a US automobile club.

The GM shutdowns could lower demand for several chemicals - as automobiles are large consumers of such products as acrylonitrile butadiene styrene (ABS), polyolefins, nylon and paints and coatings, according to the American Chemistry Council (ACC).

For the remainder of 2008, GM said it would reduce its North American production capacity by about 88,000 full-size pick-up trucks and 50,000 full-size sports utility vehicles (SUV).

“With rising fuel prices, a softening economy and a downward trend on current and future market demand for full-size trucks, a significant adjustment was needed to align our production with market realities,” said Troy Clarke, president of GM North America.

Full-size pickup truck and SUV segments in North America have declined by double digits for all manufacturers during the first quarter of the year, as consumers shift toward cars and crossovers, GM said.

Such vehicles are more fuel efficient, a factor that is influencing buyers as gasoline continues to reach new records.

For more on polyolefins and ABS, visit ICIS chemical intelligence

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