Original Saturn Plant To End With a Whimper?
When GM CEO Roger Smith wanted to create a different kind of car company (like he didn’t have several already), he commissioned a Saturn factory in Spring Hill, TN. For a short time, the factory, the brand, the model they built, the dealers who sold them and the customers who bought them all lived happily ever after. And then the GM borg assimilated Saturn. At first, they neglected it. Then they gutted it like a fish. Then they stocked dealers with a bunch of unloved German-style imports, built somewhere other than the Volunteer State. And now, that pioneering Saturn factory builds GM’s fourth badge-engineered Lambda platform. The Chevy Traverse is not doing well, saleswise. In fact, LSJ.com reports that the TN factory producing these unloved CUVs is currently operating at 24 percent of capacity. That’s after the General spent, wait for it, $690 million re-equipping the plant for the task. And remember what we said about politics informing GM’s business decisions? Check this out . . .
Erich Merkle, a Grand Rapids-based auto analyst, thinks Spring Hill could be jettisoned in favor of GM’s Lansing Delta Township assembly plant. That’s because the crossovers made there – the Buick Enclave, GMC Acadia and Saturn Outlook – are sister vehicles to the Traverse.
The Delta Township plant also has excess capacity. GM eliminated the second shift at the plant at the end of March, cutting production and throwing hundreds of people out of work.
At current sales levels, all four vehicles could be built at either plant, but politics could give the Michigan plant the edge, said Merkle, who has speculated before that Traverse production could end up at the Lansing Delta Township plant.
“Spring Hill could be on the bubble because it’s in a red state and Michigan is a blue state,” Merkle said. “The governor of Michigan is a Democrat, too, and she needs all the plants she can get.”
And here’s the money shot:
The Delta Township and Spring Hill plants should be safe if operating decisions are made rationally, said David Cole, chairman of the Center for Automotive Research in Ann Arbor.
The guy who gave Detroit the ammo to scarf federal bailout bucks is warning us about irrational operating decisions by the federally controlled automaker. That’s Rich. [Thanks to matttstairs for the link]
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