GM scraps new Volt/Cruze engine plant in Flint, will update existing plant instead
General Motors has been vascillating about when and where it would build engines for its upcoming Chevrolet Volt and Cruze models, and today that saga has a new twist. Last September, GM proclaimed that it would invest $370 million in a new Flint, Michigan plant to build 1.4-liter four-cylinder engines after the city announced an extensive suite of tax breaks said to be worth $56 million. Then, in mid-December, word came that GM was delaying building the plant, although it pledged to bring the Volt to market on-time, instead sourcing initial engines from overseas. Then came word late last month that GM had cancelled the plant contracts, leaving the company's powertrain plans in limbo. Now, GM is saying that it will indeed build the engines in Flint, it's just going to do so using existing facilities.
According to a new press release, GM is citing "current capital expenditure constraints and available floor space in existing facilities" as the reason for not pursuing a new facility. All is not lost, however, as GM still plans to invest around $250M to update the company's Flint South plant. Facility revitalization work will commence this spring, with production of the new engines slated to begin in December 2010. More details in the press release after the jump.
[Source: General Motors]
PRESS RELEASE:
GM Confirms Engine for Chevy Volt and Cruze Will Be Built in Existing Flint, Mich. Plant
General Motors has confirmed today that it will still invest approximately $250 million to bring the 1.4-liter 4-cylinder Family 0 engine production to Flint, Mich. The engine capacity for the Chevy Volt and Cruze will be allocated to existing and available floor space in the company's Flint South engine plant located on Bristol Road.
Preparations to the Flint South plant for installation of new machinery and equipment will begin this Spring. Production of the 1.4-liter engines is targeted to begin in December 2010.
Production of Family 0 engines at Flint South will be GM's most flexible and competitive engine manufacturing lines in the world, with approximately 150 highly flexible stations that will allow production of multiple 4-cylinder engine families without retooling.
This means that GM will not invest in new floor space at this time due to current capital expenditure constraints and available floor space in existing facilities.
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Reader Comments (Page 1 of 2)
Yikes 5:03PM (2/24/2009)
This was a new item a few weeks ago.
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Upthewazzu 5:09PM (2/24/2009)
Perhaps they were unable to obtaining funding from GMAC.
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Noz 2:22AM (2/25/2009)
They didn't have the 20% down now required by the then crooked mortgage brokers.
Upthewazzu 5:09PM (2/24/2009)
*obtain
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Governor of Michigan 5:10PM (2/24/2009)
Bugger.
I guess now we have to turn to the "Plan B" - making and exporting potholes, while importing garbage from Toronto.
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BigWill 5:10PM (2/24/2009)
Just slap a bowtie on the Daewoo Lacetti and import it already. By the time GM debuts the Cruze here it will be stale.
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Mr.Oak 6:30PM (2/24/2009)
Stale to whom? 99.9% of the buying public don't even know what a CRUZE is.
BigWill 8:01PM (2/24/2009)
How about stale in comparison to the rest of the competition? When the 2-3 year old Lacetti shows up here as the "new" Cruze it will be going against the new Euro Ford Focus, a redesigned Honda Civic, a redesigned Hyundai Elantra, a refreshed Mazda 3, and a likely refreshed Corolla. Don't forget it's target price is parity with the Civic's price. You think that's a recipe for success?
Conundrum 9:55PM (2/24/2009)
@ Big Will...
You mean like the Prius which was on sale in Japan in 1997 and wasn't brought to the US until 2001? The Euro Focus has been for sale elsewhere for years and you drool over it while deriding the Cruze?
Many Americans would rather buy a "new to the USA" car after another country has driven it for a few years to de-bug it.
How can you be certain that the reliability and driving dynamics of the Cruze will not match the Civic/ Elantra/Focus?
Sea Urchin 10:27PM (2/24/2009)
Mr. Oak you are 100% right, most people do not know what Cruze is. But the styling will get old, the tech will get old, and the MPG will get old.
Sure on paper Cruze is amazing, but once that car that is on the paper comes out............it will be left in the dust by the newly arrived Civic and Sentra and others.
BigWill 10:38PM (2/24/2009)
Exactly, Sea Urchin. This is going to be GM showing up late to the party with a less than current design. That's bad enough, but pricing the Cruze above the Cobalt only exacerbates the problem. Not a formula for success.
"How can you be certain that the reliability and driving dynamics of the Cruze will not match the Civic/ Elantra/Focus?"
Probably because Honda, Hyundai and Toyota can go buy a Cruze/Lacetti right *now* (on sale in Korea since last October, on sale in Europe next month) and make sure their upcoming products are better than the Cruze.
Sandeep 5:15PM (2/24/2009)
I pointed this out when the first announcement came out....doesn't exactly make sense for GM to both be paying to get rid of workers in factories it doesn't need and also to be building new factories and having to hire new skilled workers.
Glad to see they're saving money in whatever ways possible.
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zamafir 5:55PM (2/24/2009)
Yeah it's just entertaining how quick all of our resident experts were a month or so ago, point out GM wouldn't be scrapping the plant when the writing on the wall was clear. It's nice to have GM finally confirm our suspicions, and like you've mentioned, the new plant didn't make much sense given their current bail out dependency.
JZeke 5:20PM (2/24/2009)
Why the hell wasnt a factory upgrade their first choice? This is why they've been hemorrhaging money. They just throw money into ensuring gross overcapacity instead of maximizing what they already own. I just hope this comes to market ahead of schedule, those Flint workers need a break.
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alex 5:26PM (2/24/2009)
You're a dumbass. The existing plant has the capacity to build it's current engines and the volt/cruze engine.... now. Do you think that maybe a HUGE drop in the demand for vehicles in the last few months maybe... just maybe... freed up some capacity in an existing plant? some capacity that before wouldn't have been available?
OH that's right, hind sight is 20/20, especially when you're an armchair QB
Tang 5:23PM (2/24/2009)
saw this coming from a mile away
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Rich 6:37PM (2/24/2009)
So, given that the Earth travels at 67062 mph around the Sun, you saw this coming 0.054 seconds ago?
gslippy 5:27PM (2/24/2009)
Well, it might produce Cruze engines, but Volt engines...? The Cruze is a reworked Cobalt/Cavalier (yawn), and the Volt is vaporware in search of a subsidy. Good luck selling either one.
This was a political move, "build American" and all that. At least the US tax dollars will stay domestic, even if they are wasted.
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Conundrum 10:09PM (2/24/2009)
You really don't think there will be any difference between the Delta II Global Compact Car Platform being designed in Russelheim Germany which will underpin the Cruze/Volt versus the GM J body platform which underpinned cars like the Cavalier since 1981?
Volt is Vaporware? Wow that is some potentent Prius flavored koolaid you're smoking!
Willem B 10:32PM (2/24/2009)
what a great educated comment...
cavalier is a j-body (1980's - 2005)
cobalt is a delta body (2003-2009)
and the cruze is the new delta II body (future production)
the three have about as much in common as the sentra vs corolla vs civic
thanks for coming out though....