GM announces $500 million new investment in Lordstown, Ohio plant
21.08.2008 21:02
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- Source: toledoblade.com
LORDSTOWN, Ohio General Motors Corp. said Thursday it will invest more than $500 million in the U.S. to build a new compact car that will compete in an era of high gasoline prices. Company Chairman and CEO Rick Wagoner announced the size of the investment at the Lordstown factory near Youngstown. The sprawling complex now makes the Chevrolet Cobalt and Pontiac G5 small cars.
Wagoner also showed off a full-size model of the Chevrolet Cruze, providing the first glimpse of the car that will be built in Ohio. Workers, union leaders and company executives stood and cheered inside the plant when a cover was removed from the Cruze model.
GM has said the Cruze will be more fuel efficient than the comparable Chevy Cobalt. The company announced in June that the Lordstown factory would be retooled to make the new Chevrolet Cruze compact.
The company also will build 1.4-liter engines for the Cruze at a new factory to be built in Flint, Mich.
The Cruze will be launched in Europe and Asia next year. It will come to the U.S. in second half of 2010.
"The Chevrolet Cruze was designed and engineered by our global teams in Europe and Asia Pacific and will be manufactured in those regions in addition to the assembly plant here in Lordstown," Wagoner said. "Our goal for the Chevrolet Cruze is to lead in fuel economy in this very competitive car segment."
Gov. Ted Strickland praised GM's cooperation with the state and urged further investment in Ohio.
The investment in Lordstown, about 50 miles southeast of Cleveland, is good news for a region hit hard by the demise of the U.S. steel industry.
GM already is adding a third shift at the Lordstown complex to keep up with heavy demand for Cobalts.
Cobalt sales were up 16.4 percent through the first seven months of the year, while G5 sales were down about 1 percent.
Chevrolet North America Vice President Ed Peper said in a statement that GM can't make Cobalts quickly enough.
"Our dealers are asking for many more Cobalts than we can build," he said.
The Cobalt's success prompted GM to add the third production shift and 1,400 jobs the largest hiring since Lordstown opened in 1966. The complex will employ about 4,300 hourly workers and roughly 300 salaried workers.
GM has released little information on the new Cruze, which officially will debut in October at the Paris Motor Show.
It will be about 15 feet long, almost identical to the Cobalt. But GM said the Cruze will make better use of its interior space, offering more room for five passengers and cargo.
Whether or when the Cobalt and G5 might cease production has yet to be determined, GM has said.
Shares of GM shed 27 cents, or 2.7 percent, to $9.89 in afternoon trading.
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