GM pact gives hope for shuttered facilities
JANESVILLE If General Motors can successfully reorganize or emerge from a likely bankruptcy, the automaker has agreed to use one of its idled plants to build small cars that it isn't producing anywhere else in the United States.
And the fact that GM will do so at an idled plant where the local union has ratified a competitive operating agreement leads to an obvious question: Could the automaker's Janesville plant be the one retooled to annually crank out about 160,000 compact cars?
On one hand, a union summary of the tentative agreement reached last week between the United Auto Workers and GM supports the notion.
On the other, however, it dispels it.
UAW Local 95 President Andy Richardson and GM Shop Chairman John Dohner Jr. joined other local union leaders in Detroit on Tuesday. Officials there voted overwhelmingly in support of the agreement that Local 95 workers will vote on today.
The contract—an amendment and modification to the 2007 national contract—is an effort to help GM pull together the remaining pieces that would allow it to restructure outside of bankruptcy.
The deal gives the UAW stock in GM and a $2.5 billion note to fund a health care trust for retirees. In addition to cost-cutting measures, it also says most of GM's 61,000 hourly workers will get another buyout and early retirement offer.
Perhaps what is most intriguing to workers in Janesville, where GM ceased sport utility production in December, is the UAW summary of the agreement that deals with product and investment commitments.
"The company will invest in a compact and small car assembly site in the United States utilizing an idled UAW-GM facility," the summary says. "The selected site will be tooled for a capacity of approximately 160,000 annual units of production.
"The products allocated to this site will be versions of compact and small cars that are not produced at any other U.S. facility at that time."
The summary goes on to say that the local union agreement must conform to 100 percent attainment of what GM calls a "competitive operating agreement."
Last August, members of Local 95 ratified a competitive operating agreement that GM is now using as a standard to assess each plant's commitment to world-class manufacturing. At the time, Local 95 leaders said the local agreement scored 100 percent, putting it ahead of any other GM local contract in the country.
The local contract also was believed to be an important part of a presentation a local coalition made in Detroit last fall in an effort to convince GM to award the Janesville plant a new product.
The UAW summary, however, also outlines a commitment by GM to use an idle stamping plant to support the car assembly plant.
One of the raps on the Janesville plant always has been its location in GM's supply chain. In many situations, Janesville has been considered too far away from its part suppliers.
Sources have said part of the local coalition's presentation included plans to build a new stamping plant in Janesville.
But the fact that GM wants to use an existing yet idled stamping plant in support of the car operation would seem to take Janesville out of the mix.
Both Richardson and Dohner were returning to Janesville Tuesday night and could not be reached for comment.
Local coalition members said they were unaware of any Janesville-specific provisions in the new contract.