1,100 GM factory workers in Moraine, Ohio will be out of a job on December 23 as plans are announced to close the Moraine Assembly plant early, instead of the original 2010 plan (Happy Holidays to the employees.) The accelerated shutdown plans are part of company wide cost-cutting move as customers move away from sport utility vehicles to smaller vehicles amid high gas prices.
The plant builds the Chevrolet TrailBlazer, GMC Envoy, Isuzu Ascender, and Saab 9-7X. This will mark the end of all four models. With Isuzu pulling out of the U.S. market in January, the death of the Ascender is no surprise. As for Saab’s 9-7X, it is widely expected to be replaced by the superior 2010 9-4X.
General Motors turned down a $56 million tax credit and grant package from the Ohio Department of Development to keep the plant open.
Imagine roadsides piling up with Chevrolets, Buicks, Pontiacs, Saturns, Hummers, Saabs, Cadillacs, and practically all GM-made vehicles in need of repairs and/or maintenance. These cars need replacement parts, but there are none available. Doesn’t this sound like scene from apocalyptic movie? Unfortunately, this could become a sad reality unless General Motors acts swiftly. Serious financial trouble hounds up Delphi Corp, GM’s giant auto parts maker, as its officials scramble for some last-ditch efforts to save the company from imminent financial ruin.
Delphi used to be General Motors Corp in-house parts maker. It produced almost every auto part for GM’s vehicles— auto electronics, tires, hood, engine parts, safety equipment, steering systems, car frames—just to name a few.
In 1999, GM spun off the Delphi Corp and made it a separate entity. Brisk business had kept Delphi afloat, but labor costs and rising car materials gradually chewed up most of its assets until it declared bankruptcy in 2005. Its competitors had been put out of business for these same financial woes.
Now, Delphi accrues $3.4 billion in bankruptcy loans termed debtor-in-possession or DIP. It will expire this year. This means that, unless its officials implement some fast stopgap measures, Delphi will go down the drain. Delphi’s financial woes have put GM in a tight bind. As much as it wants to, the parent company could not liquidate Delphi’s liabilities since GM is saddled with serious financial difficulties of its own.
If liquidation occurs, GM would have to absorb Delphi’s 159,000 workers and accrued liabilities ---- hook, line, and sinker. Ray Young, the chief financial officer of General Motors, said GM could not bail out Delphi. On one hand, General Motors desperately needs Delphi to for its car production. On the other hand, it cannot keep the money-losing Delphi plants.
So, unless large cash infusion occurs soon, Delphi will continue stand out like a sore thumb for GM.
GM has announced plans to install solar panels on the roof of its White Marsh, Maryland, transmission assembly plant, making it the first North American factory to get them (GM has solar panels on top of its Rancho Cucamonga and Fontana, California parts warehouses as well.) The plant produces six-speed and Two Mode hybrid transmissions for the company’s light-duty trucks. It will be equipped with over 8,700 solar panels covering 300,000 square feet, which will cut the plant’s electricity bill by 20 percent annually by 2009. The panels will generate about 1.4 million kWh of clean, renewable solar energy, which is equivalent to the demand of about 140 to 150 U.S. households with an average annual consumption of 10,000 kWh, GM said.
Best of all for GM, they are paying nothing for the energy-saving system. SunEdison will finance, install, operate and maintain the system, and will make money by keeping some of the electricity generated.
Technology can hurt a driver as much as it can help him. For example, those convenient automated toll systems (i.e. EZ Pass, FasTrak, SunPass, etc.) can also use their time/distance data to figure out if you were speeding. GM may be hitting even closer to home with a new OnStar feature. Right now General Motors will use OnStar to pass on information to their GMAC Insurance arm about your annual driving mileage for possible insurance discounts.
This is purely voluntary program, and GM assures that the data will go no further than annual mileage. But how soon before they want data on speed or acceleration, all disguised under the cloak of lower insurance premiums?
The same side of me who wants to build a bomb shelter in my tool shed is also having trouble with this new OnStar service. After all, Ford is developing cars that talk to each other, GM is putting money into cars that drive themselves, and now your car wants to tattle on your driving habits. Big Brother is no longer trying to get in the passenger seat; it’s trying to drive!
I think it’s too late for me; I’ve already given in to sat nav and climate control. At least for now GM is doing no evil, and instead letting you save some additional cash on car insurance if you drive less then 15k miles a year. Besides, Big Brother technology is nothing new in cars. For almost a decade GM and other manufactures have been installing a “black box” like device that records driver stats, but your car has kept the secret to itself …so far.
At General Motors, “going green” may be as much of a catch phrase for helping the environment as it means saving precious cash. For instance, earlier this month it announced plans to lease 2,000,000 square feet of rooftop space at a plant in Zaragoza, Spain, to a company that installs solar panels. “From a GM perspective, we get revenue for leasing the roof and adding solar to a rooftop instead of taking up valuable land,” said Rob Threlkeld, GM’s Green Initiative Manager, during a web conference on renewable energy today.
The result should generate twelve megawatts of power, which should be enough to run 4,575 Spanish households. This idea is not new to GM. Two facilities in the U.S. have already implemented similar projects, but their size is much smaller than the one at the Zaragoza plant. “As big as this facility is, I don’t see many roof top projects of this size being completed around the world,” Threlkeld added.
In a press conference GM revealed official images of some of their future model, including the 2010 Chevy Cruze, 2010 Cadillac SRX, 2010 Saab 9-4X, and the 2010 Chevrolet Equinox.
At the same event, GM also confirmed the 2010 Buick LaCrosse, 2010 Cadillac CTS Coupe and 2010 Cadillac CTS Wagon.
First to debut will be the 2010 Chevrolet Cruze at the Paris Auto Show. The Cruze will be based on GM’s Delta compact-car architecture and will be powered by a new 1.4-liter global engine that delivers between 120 to 140 hp. Sources say mileage could exceed 40 mpg.
Spy photographers, we’re sorry for your jobs!
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This morning NPR aired an interesting interview with the author of "While America Aged, How Pension Debts Ruined General Motors..."
The author explains how the big three (GM, Ford, Chrysler) could get away with heavy pension cost while there was no competing products. But since foreign automaker can offer cars that don’t carry the same pension burden, GM will have no other choice than bankruptcy if they want to get out of those bad deals.
Click here, then click on ’Listen now’ to listen to the interview.
General Motors just added a new service to its OnStar technology. The new service will allow OnStar to assist the police in recovering your stolen vehicle, and hopefully reduce fatalities and injuries that result from high speed police chases. This new technology is known as “Stolen Vehicle Slowdown,” and its name pretty much tells what it was created to do. Basically, this is the latest enhancement to OnStar’s stolen vehicle service, and it allows OnStar advisors to work with the police, by sending a signal to the subscriber’s stolen vehicle that reduces engine power, slowing the vehicle down gradually.
More details after the jump.
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GM announced today their first quarter 2008 sales performance on the old continent. And they are not doing bad at all, in fact this is their best first quarter in term of volume with
570,000 vehicle sold. Chevrolet Europe Q1 sales are up 30 percent to a
record market share of 2.2 percent, GM Russia is showing 78 percent increase and the Cadillac brand is finally taking off with 13 percent growth. Even the gas guzzler Hummer brand is showing a 59 percent increased compared to Q1 2007, and keep in mind that gas in Europe cost almost $10 a gallon ! We wonder how they dit it but it seems that the American brands are finally breaking into the European market. GM global positioning is paying off and it pays in Euros, worth 1.57 US Dollar for those who don’t follow the market. Global positioning is really paying off, especially when you think that US sales outlook are in the red.
General Motors declared that they have no intentions in competing against Tata’s $2500 Nano. General Motors Asia Pacific president David N Reilly stated that they cannot compromise with the Chevrolet brand by making a competitor but are looking at making another small-car below the Chevrolet Spark’s price point.
The Chevrolet Spark is at present, the entry-level model of GM priced at US $7564 (ex-showroom price, Delhi). But nothing about the cost aspect was revealed for this new car which is planned to enter the Indian market sometime in the next two years. GM will develop this car with other similar International markets in mind and will use it to attain its target of 10 per cent market share in India by 2010.
At present, three-fourths of the cars sold in India are small cars which has evolved into a major small-car hub. Toyota, Renault, Ford, Hyundai and Fiat are all developing their own Nano versions cheaper than anything else in their product range.
Rising crude oil prices is the reason why people not only in India, but all over the world prefer small, economical cars which are easy on the environment too. But crude oil prices are not ascending alone. The cost of raw materials which includes steel and aluminium, which are used to make vital components in a car, are also increasing.
The big question remains to be safety. At such rock-bottom prices, will the safety factor be given adequate importance by car makers?
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