General Motors announced that it would extend production of the Pontiac Grand Am as a fleet vehicle, as it did with the Chevrolet Classic. The move offers GM two advantages. It avoids layoffs of UAW members, and it minimizes daily rental sales of the Grand Am successor, the 2005 G6. Pontiac hopes to keep the G6 at about 10 percent fleet sales in its initial year, according to Gary Steilen, marketing manager for the Grand Am and G6. The Grand Am has run about 33 percent fleet in recent years, he says. The Grand Am is assembled at GM's Lansing, Mich. plant. In 2006, about 2,200 workers at the plant will shift to a plant GM is building in nearby Delta Township, Mich., where different vehicles will be built. In the meantime, rather than pay laid-off workers as required by its UAW contract, GM will keep them working assembling Grand Ams. Production of the G6 sedan begins at GM's Orion Township, Mich., plant in August. Pontiac will continue to sell the Grand Am GT Coupe as a retail vehicle through 2004. That will prevent a lineup gap until GM begins building the G6 coupe early next year. Grand Am sedans will be fleet-only this fall. All Grand Ams will be fleet vehicles beginning next year.

Originally posted on Fleet Financials