At the General Motors annual meeting in Delaware today, CEO Rick Wagoner will be publicly announcing the latest restructuring round for the beleaguered automaker. In response to plummeting sales of large trucks, GM will close down four more North American Assembly plants by 2010. The plants in Janesville, Wisconsin, Oshawa Ontario, Moraine, Ohio, and Toluca, Mexico are already running reduced production schedules and will cease operations entirely as products are discontinued or shifted to other plants. The Janesville plant builds medium trucks and SUVs while Moraine builds the old body on frame Trailblazer, GMC Envoy and Saab 9-7x SUVs. The other plants build full-size pickup trucks. The closures affect 10,000 employees at those plants. Those that aren't among the 19,000 who are taking buyouts will be offered transfers to other locations to fill spaces vacated by the departing workers. The closures are expected to save GM about $1 billion a year.
Wagoner will also be announcing that GM has begun a strategic review of the HUMMER brand. We contacted GM spokesperson Joanne Krell this morning who told us that the review has just begun and there is no time frame for a decision. "The HUMMER brand is a great brand and we're probably not maximizing it to its fullest. Perhaps somebody else would have that opportunity." All options are being considered including "ramping up the portfolio," shutting the brand down or "selling it in whole or in part." At this point, GM has not had any discussions with other manufacturers about the possibility of a sale, which won't happen until the review is completed.
On the positive side of things, the board of directors has approved production of a new small Delta platform car (the eventual Cobalt replacement) at the Lordstown, OH assembly plant next year. The Chevrolet Volt has also been approved for production in 2010 at the Detroit-Hamtramck assembly plant. Thanks to Craig and Matthew for the tips!
[Sources: Chicago Tribune, General Motors]
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Reader Comments (Page 1 of 7)
Red Star @ Jun 3rd 2008 10:28AM
Ouch.
Franky @ Jun 3rd 2008 11:11AM
This article is incorrect. First Wagoner said that they are looking at alternatives as to what they want to do with the Hummer brand. They will look into either restructuring it or selling it. Never mentioned closing. Horribly misleading title.
Secondly Wagoner NEVER mentioned the platform which the vehicle would be on, when asked if it would be a Delta, he grinned and said the platform has not yet been announced. He also said the new Delta is upcoming and in 2010 we are getting a new Aveo.
I am very disappointed with the facts in this article. I sat through and listened to Wagoner, this article needs editing.
Silver @ Jun 3rd 2008 11:33AM
@ Vintage: amen, brother.
Now I can't wait for these monstrosities to plummet in value to the point that a few years from now, 16-year-olds will be driving their friends around town in them.
If that's not enough to make you fear for your life and the lives of your loved ones, I don't know what is.
Dolemite @ Jun 3rd 2008 12:09PM
Sigh. It is almost sad how posts like this always bring the nuts and greenies out in the open.
PJ @ Jun 3rd 2008 1:24PM
You don't have to be an environmentalist to rejoice at the thought of Hummer's demise (though it doesn't hurt).
As an image-builder for GM, Hummer's fifteen minutes were up by the end of 2005. With rising gas prices and growing discontent over the war, the pretend-GI-Joe-douchebag look isn't coming back anytime soon. Better to let someone else steward the brand through its last few years of relevance.
Silver @ Jun 3rd 2008 1:16PM
"Note* I do think the N/A car companies have to take some blame for not building fuel efficient cars sooner, but people losing their jobs is never a good thing." - steveo391
*Some* blame? Really???
It's amazing that the screw-ups of the American automakers always seem to be the fault of the Japanese, eh Steve?
And no, losing jobs *isn't* a good thing. Then again, making your business dependent upon an unsustainable market isn't either. The loss of jobs is *always* the result of such shortsightedness.
It's called capitalism, and it seems to have worked just fine for us the past 200+ years.
jamie @ Jun 3rd 2008 1:17PM
Double Ouch!
I expected cutbacks, but not quite so severe. Then again, there is much more that has to be cut yet.
But you can't go on cutting yourself into profitability. It just doesn't work that way. GM has huge bill payments coming up, and it still needs to make $6 billion profit to manage this Herculean feat. Cutting jobs, and cutting production will obviously make this a daunting problem in the near future.
Hence they are looking to sell whatever doesn't float. [eg. Saab, Hummer, Holden, Saturn]. This is a sad way to end a long relationship.
Buzz Hargrove got in his two cents Canadian (probably worth three cents US now):
Tuesday, June 3, 2008
GM's plant closing news angers CAW chief
Eric Morath / The Detroit News
The Canadian Auto Workers will protest General Motors Corp.'s decision to close down its Oshawa truck plant, said CAW President Buzz Hargrove.
GM's statement Tuesday that it will close four assembly plants, including Oshawa, was met with "a whole lot of anger, frustration and disappointment," the union chief said.
"We are going to fight this decision," he said. "It's illegal... it's a complete violation of the recent collective bargaining agreement."
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The Oshawa truck plant, which employs 2,600 workers, makes the Chevrolet Silverado and GMC Sierra half-ton pickup trucks.
Hargrove stopped short of threatening a strike or legal action, saying the union is still weighing its options.
"Watch us," he told reporters at a Toronto press conference Tuesday.
Hargrove charged that GM knew it would close Oshawa and three other North American plants -- in Janesville, Wis.; Moraine, Ohio and Toluca, Mexico -- even as it promised to continue production at the Canadian factory through the life of the newly signed contract.
He said there was "no way" market conditions changed in the two weeks since ratification to necessitate closing the Oshawa plant -- which he said produces trucks more profitably that its American peers.
"This is an American company, controlled by Americans, and they are making decision in tough times to protect American jobs," he said. "The market is not the problem, GM will still build pickup trucks. The question is who is going to build pickup trucks?"
Hargrove was particularly incensed that that the Oshawa plant will not build hybrid versions of the pickups. He said that production will now go to Mexico, even though GM had touted that work as part of its environmental commitment to Canada.
"It ain't going to be moved to Mexico without a god dam fight with our union," he said.
GM also produces the Chevrolet Impala at a separate Oshawa plant.
http://www.detnews.com/apps/pbcs.dll/article?AID=/20080603/BIZ/806030436/1148/AUTO01
Vintage @ Jun 3rd 2008 2:19PM
Hick, I mean Steveo,
Yes, I am a Jap fan, because american car companies produce absolute CRAP when it comes to fun to drive, small, fuel efficient vehicles. Dodge used to have the neon, which was great. 150hp, 2400lbs, and 35-40mpg, all while netting 15.5s in the 1/4 mile. Great car. Horrid interior. Now we have bloated, heavy cars that struggle to get 30. Pieces of crap.
maestromario @ Jun 3rd 2008 7:03PM
Maybe if they do a Hummer H5 based on the Chevy Tracker platform... ;-) 1L 3 cyl or 1.3l 4 cyl
vwboyaf1 @ Jun 3rd 2008 9:13PM
10,000 people are losing their jobs because their union created a situation where they were to expensive to keep around. Thats what happens when you bite the hand that feeds you. Those folks could jump across the border and help build fiesta's in Mexico hahahaha!
And Steveo, I'd be careful of the racism because first, its not 1942 anymore, and second, your next boss is probably going to be Japanese.
GM could downsize the hummer. Make a nice torquey 4 banger into something the size of Jeep. Remember the original Jeep? The one that saved Europe, and beat the...ahem, Japanese? That was a 4 banger.
tankd0g @ Jun 3rd 2008 10:30AM
GM get out of a market before it becomes a money sucking hole in the bottom line? That's unpossible!
Yar @ Jun 3rd 2008 10:31AM
God, please no. Hummer can't be sold, it's too American, too GM. This is tragic, I was just about to buy one...
Avinash machado @ Jun 3rd 2008 10:35AM
Maybe they should sell Hummer to Kirk Kerkorian. This way it will remain in American hands and Kirk gets a chance to fulfill his dream of owning an automaker.
Vintage @ Jun 3rd 2008 10:55AM
Yeah, what a great time to own a poser utility vehicle that gets 6mpg! Awesome!
Galley @ Jun 3rd 2008 11:04AM
I'd buy that for a dollar!
John @ Jun 3rd 2008 10:32AM
Moment of silence for HUMMER...
Ok..that's enough!
bakka @ Jun 3rd 2008 2:32PM
hahahahhaahhahahahahaha!
Good one!
kballs @ Jun 3rd 2008 2:53PM
Hummer + e-flex + lighter weight could save the brand... in fact it's probably the only way to keep it alive long term. Not only could it be even more capable off-road (electric motor for each wheel allowing torque vectoring and no need for lockers), but it would have reasonable MPG and not need gas for shorter commutes. However, it will be a few years before e-flex will be ready to go into a Hummer or other GM truck for that matter, so if they decide to keep the brand they might put it into hibernation in the meantime.
epilonious @ Jun 3rd 2008 10:32AM
I feel like this is a good decision and gives me more hope for the GM brands. Especially since this tidbit comes on the heels of announcements about releasing more small cars with efficient engines.
But I also feel like there are many things that could happen that would make it a bad decision (UAW Whineyness, Gas prices suddenly dropping, said small cars being bad)...
I guess time will tell, and that all people will maintain their current opinion of GM.
tim @ Jun 3rd 2008 10:38AM
This is a great decision that should have been made years ago. Now workers and shareholders will suffer for inept leadership.