Tenn. plant may be GM longshot

June 13, 2009

Tenn. plant may be GM longshot

Governor: State lacks incentive cash

FREE PRESS STAFF AND NEWS SERVICES

General Motors Corp.’s assembly plant in Orion Township might stand a better chance at winning production for a small car now that the governor of Tennessee says it doesn’t have the kind of incentive money that state would need to entice the automaker to build the car in Spring Hill.

GM has said it would make a decision — based on 12 unidentified criteria — by month’s end on which of three idled plants would build the new small car. In the running:

 

  • Orion Assembly in Michigan, which previously built the Pontiac G6 and Chevy Malibu.

     

     

  • Janesville Assembly in Wisconsin, which built large SUVs, such as the Chevrolet Suburban.

     

     

  • Spring Hill in Tennessee, which builds the Chevrolet Traverse. Production of the Traverse, however, is being shifted to a plant in Lansing, so Spring Hill will soon be without a product.

     

    On Friday, Tenn. Gov. Phil Bredesen said it would take $200 million or more for Spring Hill’s factory to stay in the game — and Tennessee doesn’t have that kind of cash.

    "This is for them all about front-end money," Bredesen said Thursday, a day after meeting privately with GM officials in Washington along with Tennessee congressional leaders.

    GM officials had no comment about whether they asked for cash.

    But at an impromptu news conference, Bredesen said, "They don’t care about tax credits and those other kinds of things. … It certainly was a new look for me at how they’re approaching this thing, which is absolutely, ‘Tell me how big of a check you’re going to write.’ "

    Although the request for a cash payment may dim Spring Hill’s chances of survival, Bredesen said, state officials will "do some serious thinking about how we respond to their request."

    Meanwhile, GM also has met with a congressional delegation from Michigan, and several state lawmakers have said they would consider providing incentives to win GM’s small car project.

    A spokeswoman for Michigan Gov. Jennifer Granholm would not discuss the state’s strategy or negotiations with GM.

    "We are fighting for every job and … that plant," Liz Boyd, said, noting that the governor and Michigan Economic Development Corp. "are fully engaged in this fight."

    GM originally had planned to build a new small car in China, but later decided it would build it in the United States as a concession to the UAW, which wants to save as many American jobs as possible as GM restructures in a Chapter 11 bankruptcy that includes billions of dollars in U.S. taxpayer aid.

    The company has been operating under Chapter 11 bankruptcy protection since June 1.

    Free Press staff writer Todd Spangler, the Associated Press and the Tennessean contributed to this report.



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