GM eyes idled factories for possible reopening

GM eyes idled factories for possible reopening

 
 

TRAVERSE CITY, Mich. — General Motors Co. CEO Ed Whitacre said Thursday the automaker is looking to start up an idled factory to meet higher demand for its products, but he didn’t say whether the Spring Hill plant would be the first choice.

The company has placed on “standby” two closed factories in Spring Hill and Janesville, Wis.

Mike Herron, UAW Local 1853’s bargaining chairman, said he was happy to hear Whitacre’s remarks, but he added that local union officials haven’t been given any indication whether GM is ready to relaunch the Spring Hill facility.

“This plant is really a plant that could go ahead and meet all the demands that GM has in terms of the extra products that they need to build up,” Herron said.

The Spring Hill plant was idled in June 2009 as GM prepared to declare bankruptcy. Spring Hill also lost out to the Orion Township, Mich. plant for a chance to produce a next-generation small car.


At the height of production, the Spring Hill facility employed more than 6,000. Now fewer than 1,000 employees remain.

Herron said a relaunch of the Spring Hill plant is also direly needed now because there are 800 laid off workers who are in danger of losing some of their benefits.

“It would be just what the doctor ordered; it would be music to our ears if in fact GM decides that they need to open up an idled plant and it were to be us,” Herron said.

Whitacre also said Thursday that GM will have a U.S. dealership network of around 4,500, about 25 percent smaller than it was in early 2009 before the company entered bankruptcy protection.

   
 

Demand for General Motors Co. stock should be good once the company decides to offer its shares to the public, CEO Ed Whitacre said Thursday.

The company, he said, is moving as fast as it can to offer shares for sale, but Whitacre would not comment on the timing other than to say as soon as possible.

Some experts had expected GM to sell only a partial stake to the public initially, but Whitacre on Thursday said “our anticipation is we’d roll it out there all at once.”

GM spokesmen later said the decision on both when and how much equity to sell will be made by current stockholders, the U.S. and Canadian governments, a United Auto Workers health care trust and former bondholders.

The U.S. government got 61 percent of GM in exchange for giving the company about $50 billion in aid as it went through bankruptcy protection last year. GM has repaid $6.7 billion of the money, and the balance was converted to the ownership stake in the automaker.

GM is anxious to get out from under government ownership to improve the company’s perception with the public, and its sales, Whitacre told reporters at an automotive industry conference.

 
 

"We want the government out. Period. We don’t want to be known as government motors,” he said in Traverse City, Mich.

Whitacre said the time likely will be right after GM announces its second-quarter earnings next week. He said the results will be impressive. GM reported net income $865 million in the first quarter, its first quarterly profit since 2007.

“You’d have to say our future is pretty bright,” he said.

 

Story created Aug 06, 2010 – 17:40:46 EDT.

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