The latest GM investment will help produce a new, more efficient line of V8s.
Barely a week after announcing big investments in plants in Kansas and Detroit, General Motors is ready to invest another $890 million in five more North American factories – a move that sources say should save or add 1,600 union jobs.
The primary investment, totaling about $400 million, will go into GM’s V8 engine plant in Tonawanda, New York. It’s part of an effort to launch an all-new powertrain for products like the Chevrolet Silverado.
Other plants on the list include an aluminum foundry in Bedford, Indiana – where employment had plunged, in recent years, from 1,200 to just 366 – Bay City, Michigan, Ste. Catherines, Ontario and Defiance, Ohio.
Since emerging from bankruptcy, last July, GM has been pushing to maximize use of its many assembly and parts plants, and is now approaching the 100% capacity mark that is critical to its reorganization plan. But, if anything, with the U.S. car market beginning a slow recovery, the company is finding itself short of capacity in some facilities, such as the plant making its popular Chevrolet Equinox crossover. And that, in turn, is driving down the company’s market share.
Mark Reuss, president of North American operations, has said repeatedly, in recent months, GM will expand operations where it makes economic sense. And, since its emergence from Chapter 11, the company has committed about $1.5 billion to U.S. and Canadian facilities – so far saving or creating about 7,500 jobs in the process.
Last week’s announcements, involving the Fairfax, Kansas, and Detroit-Hamtramck plants generated $257 million in new investments.
The automaker’s latest investments include efforts to improve its fuel-efficiency. The new Ecotec engines it is developing are expected to yield significant improvements in fuel economy. Meanwhile, the plant in Bay City will provide several critical components for the Chevrolet Volt, an extended-range electric vehicle, or E-REV, GM plans to put into production late this year.