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June 27, 2009
General Motors Corp. said Friday it will invest as much as $800 million in revamping its Orion Township factory to build a new small car, selecting Michigan over sites in Wisconsin and Tennessee.
GM officials believe the company can afford to be the first manufacturer to build small cars in the United States because of labor agreement modifications made by the United Auto Workers before the company filed for Chapter 11 bankruptcy June 1.
"It makes a product like this practical," said Troy Clarke, president of GM North America. "Everybody imports, but we believe strongly we will be able to do this on a cost-competitive basis."
The GM move will preserve about 1,200 jobs in Orion Township and 200 at the Pontiac Metal Center stamping plant and will erase some of the job losses in a state hit hard by manufacturing cuts.
Oakland County Executive L. Brooks Patterson got a call Friday morning from Tim Lee, vice president of manufacturing for GM North America, who said the state's incentive package convinced the automaker to choose Orion Township over sites in Janesville, Wis., and Spring Hill, Tenn.
"It's a feather in the cap for the Orion plant and the good men and women who work there," Patterson said. "We're delighted. That's 1,200 jobs and a significant boost to the local and state economy."
Clarke would not reveal specifics of the state incentive package.
"It was a very creative offer," he said.
The Orion Township plant produces the Pontiac G6 and Chevrolet Malibu but will be retooled so it can also build small cars the size of the Chevrolet Aveo and compact cars on the scale of the Chevrolet Cobalt or Cruze, Clarke said. The plant employs about 3,400 hourly and salaried workers.
"The people of Michigan are some of the brightest, hardest working, most skilled workers in the world, and the decision by GM to build a new small car in Michigan is a reflection of Michigan's world-class work force," U.S. Rep. John Dingell, D-Dearborn, said.
Retooling work at the plants could start late next year and production could start in 2011.
Orion Township officials recently sweetened an offer to GM that includes a 100 percent tax break on new machinery and equipment for up to 25 years -- more than double what was offered earlier this month.
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