Autoblog

When the second quarter of 2010 rolls along, 1,400 workers at General Motor's Windsor transmission factory will be out of work. The plant, which currently produces four-speed gearboxes for GM, will be phased out at the turn of the decade, with no plans to retool the facility to produce any other components. GM's Canada President, Arturo Elias, made it clear in the announcement that the decision was not a "reflection on our excellent Windsor workforce," but instead is due to a lack of available, "replacement products in the relevant timeframe for this location." Fortunately or unfortunately, today's announcement of the plant's closing takes place as the General negotiates a new contract with the Canadian Auto Workers (CAW) union.

[Source: Detroit News]

One upside to a faltering real estate market is a plethora of good buys on property. General Motors took advantage of that fact by purchasing its Renaissance Center headquarters in Detroit for $626 million in cash. For another $200 million it picked up a couple of office buildings in Pontiac, too.

GM spokeswoman Renee Rashid-Menem told The Associated Press that the company's lease was up for renewal on May 1, but they saw a good opportunity to get a deal on the place. She went on to say that as the real estate market improves, the company could sell the property and return to a lease arrangement.

Here's an interesting piece of trivia many outside the Detroit area may not know. Henry Ford II and Ford's real estate division built the Renaissance Center in 1977. General Motors claimed it as its HQ in 1996 and in 2005 completed a $500 million improvement project.

[Source: AP via Yahoo Finance]

When the current GMT900 SUVs hit the market in 2006, gas prices were already near $3.00 per gallon, but the super-sized transports sold in prodigious numbers anyway. The reasoning from the General and its customers was that there were still people with big boats or trailers to tow, and unibody CUVs just aren't up to the task. In the two years that followed, gas prices have gone from pesky to pandemic, and buyers are leaving their body-on-frame SUVs by the thousands.

The General isn't blind to the trend, and a report from Bloomberg says that GM may be ready to take the drastic step of separating the platforms of its trucks and full-size SUVs by 2012. The move is extreme because SUVs and trucks have saved development time and money by sharing a platform for many decades, but with such a dramatic shift away from the handy but fuel-thirsty rigs, GM has little choice but to think of alternatives. A unibody Tahoe or Escalade wouldn't be able to tow quite like its predecessor, but they would be lighter and have better fuel economy.

Our first thought was that GM already has eight-passenger unibody CUVs like the Enclave, Acadia, Outlook and upcoming Traverse, but without more utilitarian SUVs like the Tahoe, there should be room for a more purpose-built CUV in the lineup. While this news isn't exactly earth-shattering, we're thinking it very accurately illustrates just how fast these times they are-a-changing, and how far automakers will go to stay viable. Thanks for the tip, Fro!

[Source: Bloomberg]

General Motors has been hit so hard by the ongoing American Axle strikes that it's stopped production of the GMC Yukon, Denali, Sierra heavy-duty regular and extended cab, its commercial-duty pickup and variants of Chevrolet trucks and Tahoes. All the while, the General is still negotiating with the UAW over local contracts at some of its most important plants. To ease some of its supply problems, General Motors has reportedly offered as much as $200 million to American Axle for the funding of employee buyouts, early retirements and for the support of wage buy downs. The offer, however, is conditional on a quick resolution between American Axle and the UAW.

Spokesman Dan Flores says that GM hopes "the offer will help bridge the gap between American Axle and the UAW and that they will be able to reach a mutually satisfactory agreement in the near future." Both the UAW and American Axle sound supportive of the investment; Bill Alford Jr., vice president and incoming president at UAW Local 235 says, "We're happy that General Motors is finally coming to the table and realizing that they have a stake in American Axle's future." For GM's sake and that of the striking workers, we hope the feuding companies find an amicable solution soon, though it seems unfortunate that GM, which is not exactly posting record profits itself, should need to cough up funding to make it happen.

[Source: The Detroit Free Press]

Vägverket, the Swedish Road Administration, is reporting that General Motors used ten human cadavers for crash research. While it isn't clear which GM vehicle hosted the corpses on their one-way trip into a wall, a spokesman for Vägverket said it was most likely the Saab brand. The spokesman was also quick to point out that all of the cadavers were people "who had donated their own bodies." (Well, that is comforting to know!)

While cadavers were used in the earliest crash tests (first started in the late 1930s), most of us were under the assumption that fully-instrumented million-dollar synthetic crash test dummies, or computer simulations, had replaced human remains in current testing. Apparently, some folks at GM may have been thinking otherwise. As of today, neither General Motors or Saab have acknowledged any tests involving dead bodies, but our hunch says this issue hasn't been laid to rest. Thanks for the tip, Will!

UPDATE: Saab called to let us know that neither it nor General Motors use "postmortem human test subjects" for safety research, nor do they have the facilities to even do so. They do, however, provide funds to certain bio-mechanical research projects, often through universities, the results of which they use to make better crash test dummies.

[Source: The Local]

GM President Frtiz Henderson came squeaky clean about the state of GM's brand portfolio, hurdles and losses. On the issue of too many brands, he admitted that the reason GM still has so many is that it is simply too expensive to kill any one of them. GM spent almost a billion large putting Oldsmobile to sleep, and with The General coming off a $3.25 billion Q1 loss, every half penny counts. In the mean time, GM will have to make do with its four new brand czars.

Henderson and CFO Rick Young also admitted that sales projections could be described as "rosy," the word "Delphi" is beginning to rhyme with "albatross," and that the intergalactic rise in gas prices has changed consumer buying habits "faster than we thought."

Fritz summarized the situation with: "We have to adjust. We have to learn how to make more money in cars and crossovers and tighten our belts with regard to cost expenditures." That's not the writing on the wall, that is the wall itself. Thanks for the tip, throwback!

[Source: CNN Money]

General Motors announced today that it recorded a net loss of $3.25 billion during the first quarter of 2008, but it looks worse than it is thanks to a $1.45 billion hit from its 49% stake in floundering GMAC. The two-month long American Axle strike also cost GM about $800 million, while further support of bankrupt supplier Delphi's restructuring took $731 million from the corporate coffers. These "headline numbers" don't look good, but GM's performance in the area of actually selling cars wasn't as bad as analysts expected, and the automaker's stock actually rose after these earnings were announced.

GM continued to do well in the business of selling cars in regions like Europe, Asia and Latin America, but the North American market continued to underperform. In North America, GM lost $812 million on revenue from sales of $24.5 billion, compared to a loss of $208 million last year on $28.1 billion of revenue. Aside from selling fewer vehicles, GM also lost 100,000 units of production thanks to the American Axle strike, which helped its market share slip from 22.5% last year to 21.7% in Q1 2008. Clearly the news isn't as good as it was, say, for Ford, but GM is virtually the only automaker being affected by the American Axle strike, and has a number of labor- and supplier-related issues to sort out before it can begin building a steady stream of its most popular models in North America.

[Source: GM, Automotive News - sub. req'd]

General Motors is on a campaign to streamline and cut through red tape, and to that end is changing the management structure of its brands. As of June 1, GM is establishing four new "brand czars" who will have increased control over their products and be responsible for their divisions' successes and failures. Pontiac-Buick-GMC, Cadillac-HUMMER-Saab, Chevrolet and Saturn will each be accountable to a new brand chief, who in turn will report to the corporate VP of sales, service and marketing. The positions, which will all be vice-president-level appointments (except for Saturn, whose brand czar will coordinate with Opel), will have increased input into the overall process from product development through sales.

The new brand czars will replace the five regional general managers that have acted until now as an insulator between the brands and its dealers. Insiders are hailing the move as a positive step, helping General Motors to streamline its bureaucracy.

[Source: Advertising Age]

Word just came in from General Motors that the automaker will be reducing shifts at four different plants that produce its full-size trucks and SUVs in an effort to bring production "in line with market demand". The output slowdown will begin on July 14th at GM's Flint, Janesville and Pontiac assembly plants, which produce the Chevy Heavy-Duty Silverado, Tahoe, Suburban, Silverado and GMC Yukon, Yukon XL and Sierra. The Oshawa truck plant will also be affected starting Sept. 8th. All told, the shift reductions will nix 80,000 full-size pickups and 50,000 full-size SUVs from GM's North American production capacity.

According to GM, both vehicles have lost ground in the market across the industry, with sales of full-size pickups dropping 15-percent and SUVs down 26-percent for the first quarter of 2008. This isn't surprising considering the cost of fuel right now and the subsequent reduced demand for larger vehicles. GM didn't provide specifics about how this would affect workers, only saying that it will "result in lower staffing requirements at all four plants," and that the details "would be worked out over the next several weeks with the UAW and CAW."

Naturally, GM felt the need to brighten up the lackluster announcement by highlighting that car and CUV sales are up. However, it hasn't made a decision to boost output of either type of vehicle in lieu of said increased demand. Check out GM's full press release after the jump.

[Source: GM, Photo by Scott Olson/Getty]

GM has seen plenty of tough times over the past few years, and even the company's top executives have felt the pinch. Executive pay was among the items cut as the General waded through multi-billion-dollar losses and immense market pressure, but after two years of cuts, the members of GM's top brass are getting their old salaries back. Top boss Rick Wagoner's base pay went as "low" as $1.1M but is now back to its 2003 level of $2.2M. Product czar Bob Lutz and money man Fritz Henderson also had their pay restored, and Fritz even got a raise to reflect his promotion to COO. Many of the pay cuts were voluntary in recognition of GM's market struggles, but even with the cuts in base pay, overall executive pay packages are worth a lot more than just the salaries alone. Wagoner, for example, was paid $14.4M in 2007, while Maximum Bob came in at $6.9M.

[Source: Auto News (subs. req'd)]