BREAKING: GM to close 4 truck plants, may sell or close HUMMER

[Klaus]

BREAKING: GM to close 4 truck plants, may sell or close HUMMER

Posted Jun 3rd 2008 10:23AM by Sam Abuelsamid
Filed under: Hybrids/Alternative, SUVs, Trucks/Pickups, Plants/Manufacturing, Chevrolet, GMC, HUMMER

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]

http://www.autoblog.com/2008/06/03/breaking-gm-to-close-4-truck-plants-may-sell-or-close-hummer/

[Klaus]

GM looking to shed Hummer

Associated Press
2:31 PM CDT, June 3, 2008

General Motors is closing four plants and taking a hard look at its iconic Hummer brand as surging fuel prices hasten a dramatic shift to smaller vehicles.

CEO Rick Wagoner said Tuesday before the automaker's annual meeting in Delaware that the Hummer line, some of which is produced in northern Indiana, will be reviewed and potentially sold or revamped. GM also will close truck and SUV plants in Oshawa, Ontario; Moraine, Ohio; Janesville, Wis.; and Toluca, Mexico.

AM General makes Hummer H2s for General Motors at a Mishawaka factory that employs about 400 people. The northern Indiana factory employed more than 1,000 people in 2002 when it opened.

Wagoner announced the moves in response to slumping sales of pickups and SUVs brought on by high oil prices. He said a market shift to smaller vehicles in the U.S. market is likely permanent.

"We at GM don't think this is a spike or a temporary shift," Wagoner said.

Wagoner said GM is "undertaking a strategic review of the Hummer brand, to determine its fit with GM's evolving product portfolio" in light of changing market conditions.

"At this point, we are considering all options for the Hummer brand ... everything from a complete revamp of the product lineup to partial or complete sale of the brand," he said.

AM General also made the original, larger Hummer, the civilian version of the military's Humane, but stopped production on that in 2006. The factory resumed production this week on H2s after layoffs that started in March following the strike at American Axle and Manufacturing Holdings Inc., a key parts producer for GM.

AM General spokesman Lee Woodwind declined to comment on the GM news.

But local chamber of commerce representative Phil D'Amico welcomes the carmaker's strategic review. He said rising gas prices have made people concerned about Hummer production. AM General is the fourth largest employer in St. Joseph County and one of the largest taxpayers.

"I think when you start looking at the (vehicle) cost, then you start looking at gas prices, I think they've got to do something," said D'Amico, director of business growth for the Chamber of Commerce of St. Joseph County.

The moves Wagoner discussed Tuesday will save the company $1 billion per year starting in 2010. Combined with previous efforts, GM will have trimmed costs by $15 billion a year, the CEO said.

The cuts will affect 10,000 hourly and salaried workers, total, at the four plants. Many will be able to take openings created when 19,000 more U.S. hourly workers leave later this year through early retirement and buyout offers.

Wagoner said General Motors Corp.'s board also approved the production schedule of the Chevrolet Volt in Detroit, and the company plans to bring the plug-in electric car to showrooms by the end of 2010. The Volt runs on an electric motor and has a small engine to recharge its batteries.

The Detroit-based automaker has just emerged from a spate of labor problems, with two local union strikes at key factories and a nearly three-month strike at American Axle.

GM said in a recent regulatory filing the strikes will cost it a total of $2 billion before taxes in the second quarter.

Detroit's automakers have been making the shift to more fuel-efficient vehicles, but not at the pace that matches consumers' drive to hybrids and high mileage models made overseas. Gas prices have accelerated the retreat from trucks and sport utility vehicles, leaving the Big Three at the most critical crossroads in 30 years.

The U.S. market is difficult for every automaker, with consumer confidence weak and 2008 sales expected to be the lowest in more than a decade. But it is most difficult for the Detroit Three, who have relied more heavily on sales of trucks and SUVs than their foreign counterparts. Trucks make up 70 percent of Chrysler LLC's U.S. sales, for example, compared to 41 percent at Toyota Motor Corp.

More cuts will be announced later. Wagoner said GM will consolidate engine, transmission and other parts operations to go with the assembly plant actions.

http://www.chicagotribune.com/busine...,2928671.story

[drewtiss@hotmail]

Originally Posted by Klaus

GM looking to shed Hummer

Associated Press
2:31 PM CDT, June 3, 2008

General Motors is closing four plants and taking a hard look at its iconic Hummer brand as surging fuel prices hasten a dramatic shift to smaller vehicles.

CEO Rick Wagoner said Tuesday before the automaker's annual meeting in Delaware that the Hummer line, some of which is produced in northern Indiana, will be reviewed and potentially sold or revamped. GM also will close truck and SUV plants in Oshawa, Ontario; Moraine, Ohio; Janesville, Wis.; and Toluca, Mexico.

AM General makes Hummer H2s for General Motors at a Mishawaka factory that employs about 400 people. The northern Indiana factory employed more than 1,000 people in 2002 when it opened.

Wagoner announced the moves in response to slumping sales of pickups and SUVs brought on by high oil prices. He said a market shift to smaller vehicles in the U.S. market is likely permanent.

"We at GM don't think this is a spike or a temporary shift," Wagoner said.

Wagoner said GM is "undertaking a strategic review of the Hummer brand, to determine its fit with GM's evolving product portfolio" in light of changing market conditions.

"At this point, we are considering all options for the Hummer brand ... everything from a complete revamp of the product lineup to partial or complete sale of the brand," he said.

AM General also made the original, larger Hummer, the civilian version of the military's Humane, but stopped production on that in 2006. The factory resumed production this week on H2s after layoffs that started in March following the strike at American Axle and Manufacturing Holdings Inc., a key parts producer for GM.

AM General spokesman Lee Woodwind declined to comment on the GM news.

But local chamber of commerce representative Phil D'Amico welcomes the carmaker's strategic review. He said rising gas prices have made people concerned about Hummer production. AM General is the fourth largest employer in St. Joseph County and one of the largest taxpayers.

"I think when you start looking at the (vehicle) cost, then you start looking at gas prices, I think they've got to do something," said D'Amico, director of business growth for the Chamber of Commerce of St. Joseph County.

The moves Wagoner discussed Tuesday will save the company $1 billion per year starting in 2010. Combined with previous efforts, GM will have trimmed costs by $15 billion a year, the CEO said.

The cuts will affect 10,000 hourly and salaried workers, total, at the four plants. Many will be able to take openings created when 19,000 more U.S. hourly workers leave later this year through early retirement and buyout offers.

Wagoner said General Motors Corp.'s board also approved the production schedule of the Chevrolet Volt in Detroit, and the company plans to bring the plug-in electric car to showrooms by the end of 2010. The Volt runs on an electric motor and has a small engine to recharge its batteries.

The Detroit-based automaker has just emerged from a spate of labor problems, with two local union strikes at key factories and a nearly three-month strike at American Axle.

GM said in a recent regulatory filing the strikes will cost it a total of $2 billion before taxes in the second quarter.

Detroit's automakers have been making the shift to more fuel economy vehicles, but not at the pace that matches consumers' drive to hybrids and high mileage models made overseas. Gas prices have accelerated the retreat from trucks and sport utility vehicles, leaving the Big Three at the most critical crossroads in 30 years.

The U.S. market is difficult for every automaker, with consumer confidence weak and 2008 sales expected to be the lowest in more than a decade. But it is most difficult for the Detroit Three, who have relied more heavily on sales of trucks and SUVs than their foreign counterparts. Trucks make up 70 percent of Chrysler LLC's U.S. sales, for example, compared to 41 percent at Toyota Motor Corp.

More cuts will be announced later. Wagoner said GM will consolidate engine, transmission and other parts operations to go with the assembly plant actions.

http://www.chicagotribune.com/busine...,2928671.story

Everyone knows that the Big Three of Detroit was already on the verge of sales slowdown. GM has donated atleast 17 Hummers in a particular org and that's something we should look up to.

[hummeraddict]

Is there any new news on whats happening to Hummer? What happens if they close all together? Do they still have to honor warranties?

[Hummer Guy]

No word on HUMMER, but it will be coming before March 31st.

If they sell, warranty wouldn't be much of an issue (look at Land Rover a year after they sold...no difference)

If they didn't sell it and closed the brand, it would be similar to Oldsmobile, where GM is still there so the warranty is honored through another dealership.

It's highly unlikely that the warranty would just be void after a certain date.

[DRTYFN]

But but but, weren't they stupposebly going to sell Hummer by year end 2K8?

[hummeraddict]

Originally Posted by Hummer Guy

No word on HUMMER, but it will be coming before March 31st.

If they sell, warranty wouldn't be much of an issue (look at Land Rover a year after they sold...no difference)

If they didn't sell it and closed the brand, it would be similar to Oldsmobile, where GM is still there so the warranty is honored through another dealership.

It's highly unlikely that the warranty would just be void after a certain date.

what is the importance of march 31st?

[Hummer Guy]

Originally Posted by DRTYFN

But but but, weren't they stupposebly going to sell Hummer by year end 2K8?

Henderson said he had "hoped" to sell by year end, but said it was "OK" if it was early 2009.

[Hummer Guy]

Originally Posted by hummeraddict

what is the importance of march 31st?

GM says it will make an announcement about HUMMER (whether it will be a major announcement is unknown, but will probably outline the future of the brand) by the end of the 1st quarter.

[hummeraddict]

Originally Posted by Hummer Guy

GM says it will make an announcement about HUMMER (whether it will be a major announcement is unknown, but will probably outline the future of the brand) by the end of the 1st quarter.

Hopefully its a sale and not a complete shutdown. i would cry for days, maybe years.