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GM still likes TN business climate

June 7, 2009

GM still likes TN business climate

By Matt Kisber

The largest industrial bankruptcy filing in U.S. history came as little surprise, but its impact on Tennessee caused concern.

General Motors announced the closing of 14 facilities around the country and the idling of three assembly plants, including Spring Hill. Beginning in November, the Chevrolet Traverse being built in Spring Hill today will transition to a plant in Michigan, leaving the plant without a GM model to assemble and putting more than 2,400 Tennesseans on indefinite layoff.

While the idling of Spring Hill is a cause for concern, there are positive signs on the horizon. Six hundred stamping and powertrain workers will continue manufacturing engines for other GM models during the idle period, and Spring Hill is under consideration for a new, small car the automaker is tentatively targeting for 2010. I believe Spring Hill has a good chance at winning the production for this new model, and there are several good reasons for that optimism:

• Spring Hill is the newest-generation, most productive and technologically advanced plant in the GM portfolio. The company invested more than $800 million to retool the facility as it transitioned from Saturn to Chevrolet. That retooling gives Spring Hill a flexibility many other plants don’t have.

• The state of Tennessee committed more than $35 million to help retrain workers to build the Traverse, and GM has used less than half of that training money. Closing Spring Hill would mean GM would walk away from significant training dollars as well as a giant capital investment.

Expert workers in Spring Hill

• Spring Hill’s work force is second to none. The employees at Spring Hill have experience building SUVs, crossovers and passenger cars, and they’ve shown a commitment to quality. Plus, all steps in the manufacturing process can be done at Spring Hill, from casting to assembly, to painting to distribution.

• Perhaps most importantly, GM has a relationship with Tennessee going back more than two decades. GM knows firsthand why Tennessee’s business climate is ranked among the top in the United States. Our per capita tax burden is among the lowest in the country, and we’ve been consistent in our tax structure. Through Democratic and Republican administrations, Tennessee has remained committed to being a great place to do business.

Gov. Phil Bredesen and I have remained in close contact with GM officials over the past months, and the automaker knows the Bredesen administration is committed to working closely with our senators and congressmen to help General Motors return to profitability.

There’s a very good reason the automotive industry has been growing in the southeast U.S. and in Spring Hill: GM has the opportunity to profit from an already significant investment. One need only look at the recently announced $1.2 billion Tennessee investment by Hemlock Semiconductor, another Michigan company, to see why businesses are interested in Tennessee.

I feel confident the decision makers at General Motors realize Spring Hill can be a powerful engine driving the resurgence of an iconic American brand.

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