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General Motors to cease production at 4 factories
June 4, 2008
Katie Merx - Detroit Free PressIssue date: 5/29/08 Section: Real News
WILMINGTON, Del. _ General Motors Corp. will idle four truck plants and boost production of cars as part of a plan to respond to a rapidly changing U.S. auto market and align the business for a return to profitability in North America, Chairman and CEO Rick Wagoner said this morning in advance of the corporation's annual meeting.
GM will idle its truck plants in Moraine, Ohio; Oshawa, Ontario; Janesville, Wis.; and Toluca, Mexico, which he said employ 10,000 workers and make midsize SUVs, pickup trucks, large SUVs and medium-duty trucks.
The reduced assembly will result in cuts at stamping and powertrain plants as well.
GM also announced that it is studying the future of the Hummer brand, considering everything from a major repositioning of the brand to its partial or full sale.
Additionally, the automaker made a series of announcements about adding shifts and products to new U.S. car plants.
The changes are intended to address a recent and rapid shift in U.S. consumer demand in the midst of a weak U.S. economy, mortgage crisis and gas prices above $4 a gallon driving an unprecedented shift in consumer preferences to cars and crossovers from large pickups and SUVs.
The shift has been particularly tough on GM and its fellow Detroit automakers, who had come to depend on larger vehicles for their largest profit margins.
"The U.S. industry is going through changes probably faster than we've ever seen before," GM president and chief operating officer Fritz Henderson said.
Going forward, GM's focus on cars and crossovers will accelerate, Wagoner said. GM plans for 18 of its next 19 new product launches in the United States to be cars or crossovers.
"Higher gas prices are having a significant effect on U.S. auto sales levels, and especially on mix, as consumer demand shifts from trucks and SUVs, to cars and crossovers," Wagoner said.
In response, GM will add third shifts at its assembly plants in Orion Township, Mich., and Lordstown, Ohio. Orion manufactures the Chevrolet Malibu and the Pontiac G6, and Lordstown, Ohio, builds the Chevrolet Cobalt and the Pontiac G5.
GM will idle its truck plants in Moraine, Ohio; Oshawa, Ontario; Janesville, Wis.; and Toluca, Mexico, which he said employ 10,000 workers and make midsize SUVs, pickup trucks, large SUVs and medium-duty trucks.
The reduced assembly will result in cuts at stamping and powertrain plants as well.
GM also announced that it is studying the future of the Hummer brand, considering everything from a major repositioning of the brand to its partial or full sale.
Additionally, the automaker made a series of announcements about adding shifts and products to new U.S. car plants.
The changes are intended to address a recent and rapid shift in U.S. consumer demand in the midst of a weak U.S. economy, mortgage crisis and gas prices above $4 a gallon driving an unprecedented shift in consumer preferences to cars and crossovers from large pickups and SUVs.
The shift has been particularly tough on GM and its fellow Detroit automakers, who had come to depend on larger vehicles for their largest profit margins.
"The U.S. industry is going through changes probably faster than we've ever seen before," GM president and chief operating officer Fritz Henderson said.
Going forward, GM's focus on cars and crossovers will accelerate, Wagoner said. GM plans for 18 of its next 19 new product launches in the United States to be cars or crossovers.
"Higher gas prices are having a significant effect on U.S. auto sales levels, and especially on mix, as consumer demand shifts from trucks and SUVs, to cars and crossovers," Wagoner said.
In response, GM will add third shifts at its assembly plants in Orion Township, Mich., and Lordstown, Ohio. Orion manufactures the Chevrolet Malibu and the Pontiac G6, and Lordstown, Ohio, builds the Chevrolet Cobalt and the Pontiac G5.
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