Still standing by: Little happening to restart GM plant
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Not quite four years ago, one of every four square feet of industrial space in Rock County was vacant, the result in large part of the collapse of the local auto industry.
In a two-day package, The Gazette looks at the use of industrial space in Rock County and how the area is slowly filling some of that space.
Today: There’s no mistaking that the former General Motors assembly plant in Janesville is the granddaddy of industrial buildings in Rock County. There’s also no question that the 4.1 millionsquare-foot building is still vacant. While redevelopment talk is ongoing, action is not.
Monday: Even with the GM elephant in the room, the vacancy rate among industrial buildings in Rock County has improved, particularly because of dramatic improvements in the reuse of once empty buildings in Janesville.
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More than four years after the bulk of the facility was idled, the Janesville GM Assembly plant's 4-million plus square feet is the largest empty building in the city.
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JANESVILLE — The speculation about Janesville’s most famous vacant building crops up as routinely as the seasonal weeds in its sprawling parking lot.
Virtually any activity at the General Motors plant triggers community interest in what’s happening—or about to happen—at the hulking 4.1 million-square-foot facility that’s now been shuttered for about four years.
The reality, however, is that not much of anything is going on at the plant, which GM continues to hold in standby status with no impending plans for the 250-acre property that includes the neighboring auto transport yard to the south.
“Future market conditions and our UAW-GM National Agreement will dictate what happens to the plant going forward,” GM spokesman Bill Grotz said in an email. “The term ‘standby’ is synonymous with idle.”
In the meantime, local economic development officials idle on the sidelines, periodically reaching out to the automaker and fielding inquiries from any interested developers.
“The unfortunate reality is that while this is a really big thing for Janesville, the decision is being controlled at the national level by GM and its union,” said Vic Grassman, Janesville’s economic development director.
GM laid off more than 1,300 workers on the plant’s light-duty Suburban line in December 2008, five months after 1,300 people had already lost their jobs on the second shift.
With a relative handful of employees left behind, GM produced its last medium-duty truck in April 2009 and turned out the lights on a production run that spanned 10 decades in Janesville.
Local speculation resurfaced as recently as last month when the number of vehicles in one parking lot outnumbered the normal contingent attributable to the handful of security and maintenance people still inside the plant.
That activity, Grotz said, involved the removal of production equipment to support other GM operations.
When asked specifically about the status of the Janesville plant, its condition and what’s left inside, Grotz declined a request for an interview but said in an email:
“There’s really no story to tell here. The plant is on standby and will remain so for the foreseeable future. We maintain security at the plant and conduct regular maintenance. The activity observed at the plant in late November/early December was just routine removal of surplus equipment, which is part of our normal course of business.”
Any decision on the plant’s future rests with GM, which isn’t likely to make one without input from the United Auto Workers—at least until the current labor contract expires in September 2015.
Sporadic talks
As they’ve done for the last four years, local economic development officials still reach out to GM officials about the status of and possibilities for the plant.
“We continue to have a dialogue with the people in Detroit, and if and when we get inquiries from prospective users or developers, we pass that information along,” said James Otterstein, Rock County’s economic development manager. “The challenge is that the building is technically not available.
“It’s sort of like me being interested in your house, which isn’t for sale.”
Otterstein said the inquiries are periodic, and they tend to come from people interested in the scrap value of the assets or those with development interests in the transportation, defense and alternative energy industries.
Grassman as recently as October talked with a couple of people interested in a development that included a multimodal hub. Given the property’s rail service, it could be a distribution point where trucks are put on trains for distribution, he said.
Any re-use of the Janesville property likely would follow one of two scenarios.
The first would involve a return of some sort of GM production.
Some industry observers rule that out, arguing that if more capacity is needed, GM will continue to push its other plants to full three-shift production.
Others, however, point to a resurging industry that might need to tap empty auto plants, even if it would mean an investment of hundreds of millions of dollars in Janesville.
The second involves a GM decision that it no longer needs the Janesville plant. In that case, industry observers said GM would either sell the property to a third party for maximum asset value or demolish the facility for maximum scrap value.
What’s buried where?
If the building is ever demolished or sold, the new owners would face a spate of environmental issues, which at this point are widely rumored but not validated.
Environmental concerns associated with the local plant are legendary, fueled primarily by generational talk of buried vehicles and waste such as paint and toxic solvents.
In recent years, representatives from the Environmental Protection Agency and the Wisconsin Department of Natural Resources have worked with city officials in an effort to assess the situation at the plant. They have been denied access to the property, however, making an assessment nearly impossible.
In the past, DNR officials have said they would like access to GM data to see what type of materials could pose environmental problems. Based on that, the department would start drilling for samples and follow up with remediation plans, if necessary.
“Because it was made part of the so-called good GM, it’s my understanding that it has gone through various stages of environmental reporting,” Otterstein said. “We’ve been led to believe that over the last 25 to 30 years—pick a period—as situations were identified, they were addressed.
“To what extent, however, we just don’t know.”
Linda Hanefeld, a program manager in the DNR’s division of air, waste and remediation and redevelopment, said officials met with GM representatives in December about how the automaker can start to assess possible contaminants.
While not much else has happened on the environmental front in the last two years, the December meeting opened the door to future discussions, she said.
Ticking clock
Environmental uncertainty couples with the property’s size to create a significant challenge to its re-use, Otterstein and Grassman said.
Both said the demand for 4.1 million square feet of space is virtually nonexistent.
“There is some good space there, but not 4.1 million square feet of it,” Grassman said. “Nobody needs all of that, so the possibility is that some of it could be demolished, particularly in areas where there might be environmental concerns, and it could be broken up for a variety of uses.”
As local speculation continues, the plant’s biological clock continues to tick.
The building has undoubtedly deteriorated, Grassman said.
Because so few local officials have been in the plant, it’s difficult to know to what extent the building has degraded and whether that would be a deal-killer for a prospective developer.
“There is certainly an ongoing concern about the long-term health and utilization of that property,” Otterstein said. “Unfortunately, there are a variety of factors that influence what needs to be done.”
Added Grassman: “The reality is that we lost GM and the local suppliers, and you have to assume that at this point it’s an inefficient operation.
“It would be great if we could just move on.”
Jan 31, 2013 at 1:09 p.m.
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Who knows whats going on in the plant...I think Janesville has its own Area 51
Jan 29, 2013 at 12:11 p.m.
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bbb- don't know. tired of it. I just posted a comment on Saturday that another "gm" article would be coming and BAM the next day. WE need to MOVE ON. WE don't need GM!
SLeep- you are correct it is HISTORY now.
The place is a dump to make it like the other newer, nicer, more efficient ones is impossible for the money it would take.
I am sure they get a huge "loss write off" for it sitting there collecting garbage and growing weeds.
"grandpaB
Jan 28, 2013 at 7:31 a.m.
Don't despair, when the Chevy volt sales reach 500,000 per year they'll need the plant."
Lol- Honda and Toyota have the top spots for small cars at around 450k between the two of them. Dont think volt even made the top 10. Cruze was lower top 10. Sorry.
They have already had the option a couple times to pick this plant and chose others.
"Macdaddy
Jan 28, 2013 at 11:47 a.m.
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paying unskilled labor more than our teachers and other professionals is ridiculous. I know many people around here wanted the gravy train to never stop and didn't want to push themselves educationally, but this is what happens. Everyone was envious, until you all got your pink slips and lost your homes to foreclosure, then they felt sorry for you that you squandered a lot of money away."
To add would go on strike all of the times and want MORE MORE MORE- now they are gone- NO MORE!
Jan 28, 2013 at 12:59 p.m.
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I understand that Parker Pen is considering subleasing space from GM....."
Doubt it- that last office in Janesville of 2 people is still in a living room."
bellman- not hate just facts.
Jan 28, 2013 at 10:23 p.m.
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The city should use it's eminent domain power to seize the plant and begin digging around looking for Jimmy Hoffa.
Jan 28, 2013 at 10:19 p.m.
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I still believe the old plant should be used for raising chickens. All city residents that want to raise chickens in their backyards should be given a small area in the plant to do so.
Jan 28, 2013 at 8:59 p.m.
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I am glad to see all of the great support for all the wonderful people of Janesville. No wonder that no one wants to be here. Only hate and more hate put on everyone. What a wonderful place to be!!!!!!!!!!!!
Jan 28, 2013 at 5:50 p.m.
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Toyota has passed-up GM once again. Maybe they will lease the Janesville plant and make Tacomas here.
Jan 28, 2013 at 2:57 p.m.
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Ninjadude- telling Macdaddy to use his head is like telling Sigma40 to quit complaining. It'll never happen. They come on here and make fools of themselves talking about things that they know absolutely nothing about.
Jan 28, 2013 at 1:39 p.m.
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Obama can make it happen if he wants to. He must not care about creating jobs....
Jan 28, 2013 at 1:23 p.m.
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Mac- If this was a union issue, don't you think GM would've had to build a new plant somewhere to keep up with demand when they closed Janesville? Arlington and Silao were already making SUVs when Janesville closed, so it is clear that GM simply came to a point where just 2 plants could handle the demand for the product! Its simple math, less demand = less factories. Use your head!
Jan 28, 2013 at 1:22 p.m.
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Wouldn't work TCB. The Republicans are too afraid to let the prisoners in the country. I mean they tried this with an empty facility in Il.
Jan 28, 2013 at 12:59 p.m.
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I understand that Parker Pen is considering subleasing space from GM.....
Perhaps Obama will consider repurposing the GM site as Gitmo North-close Gitmo as Obama promised in his first term and hire a bunch of displaced workers to guard hardened Afghani and middle eastern prisoners of war.....think of the Jobs created and saved AND the prisoners could take extension courses from UW Madison and U rock while cleaning up the GM site.....win win.....(think of all the new democrat voters!)
Jan 28, 2013 at 11:47 a.m.
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paying unskilled labor more than our teachers and other professionals is ridiculous. I know many people around here wanted the gravy train to never stop and didn't want to push themselves educationally, but this is what happens. Everyone was envious, until you all got your pink slips and lost your homes to foreclosure, then they felt sorry for you that you squandered a lot of money away.
The unions are the ones to blame, if you would have had realistic benefits and wages for what people did, the jobs would still be here. The unions pushed and pushed until they lost it all. GM is not coming back and if it does, you will not like the wage structure for all you holding out hope.
Move On!
Jan 28, 2013 at 11:44 a.m.
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Joan, there still needs to be a use case for this specific plant. If they are selling X number of vehicle Y and already have the capacity to expand production of vehicle Y there is no use case for opening this plant.
Jan 28, 2013 at 11:18 a.m.
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Joan: For years people were envious of autoworkers wages and benefits without realizing it indirectly helped raise theirs. Starting wage is now a little over $15 per hour. Limited benefits. No pension. No retirement health care. I believe the most they can get to is $19.28 per hour. Once the old timers are gone, the new standard will apply to all. There is no 3 year catch-up like the old days. And other companies are already using the automakers as examples for cutting wages and benefits for their workers. It is no longer a question of trying to keep from losing workers to GM, Chrysler, or Ford. They can simply tell their workers that if they don't like it, go get a job at the auto companies. In fact, the anticipation is that in the next contract there will be enough of these lower paid workers that the companies will offer them a couple bucks more an hour and then bring down the wages of the old timers to match. Unequal pay for equal work is causing problems and they figure there will be enough votes from those making the lower raise to pass such a contract. Time will tell.
Jan 28, 2013 at 10:58 a.m.
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I wonder if what spurred this article, although strange that it was not mentioned, is the announcement less than a week ago that GM will invest 1.5 billion in North America which will result in job growth.
Originally they said that when auto sales rise to a certain level, they will reopen the plants, or at least that's what the analysts said. I believe it was less than $15M (13.5M-14.5M) and we are at 15.3M now.
http://gmauthority.com/blog/2013/01/gene...
So given they have made this announcement of the investment and we are on standby, it seems it would be about time for the reopening of the plant.
As to the meager starting wages - good luck with that GM. Today's GM workers are like migrant workers - worked too hard, away from their families via transfer and stressed. The only thing keeping anyone there is a retirement package and a good wage. Take those away, and you won't get anyone asking for an application. You had better get the regular wage workers to transfer back because you are going to suffer very high turnover with the new hires. You see what happens with the temps you now hire - they can't take it.
Jan 28, 2013 at 10:23 a.m.
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It's time to push GM. Do something with it or get rid of the blight.
Jan 28, 2013 at 9:51 a.m.
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I have to wonder; if the City is really concerned about what environmental conditions exist in/under the GM plant, why can't they obtain a search warrant to investigate the suspected pollution. What damage can be done in the immediate area of the plant? Rock River is really close to the plant; is anyone concerned about that? I hope it reopens, but it really doesn't look to promising. I'm originally from Kenosha; home of the Nash, the AMC Gremlin and Pacer, and as of two years ago, Chrysler engines. Chrysler has in the last 10 to 13 years have invested MILLIONS of dollars in that plant. Today, and I MEAN today, the buildings are coming down; leveling 30 square blocks in the middle of Kenosha. I'm saying that because it can happen here too, so don't be surprised if it does happen.
Jan 28, 2013 at 7:31 a.m.
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Don't despair, when the Chevy volt sales reach 500,000 per year they'll need the plant.
Jan 28, 2013 at 7:21 a.m.
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gray_ghost- And you watched this while you were out at night burying your in-laws' bodies? Gimme a break! The contaminated soil was shipped out in special Hazardous Waste train cars at a very high price. GM would not dare mess with the EPA. What are you, nuts?
Jan 28, 2013 at 6:32 a.m.
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Even if this plant opened again it would never pay the wages it did or the benefits. $13-$14 an hour with just basic benefits?
Jan 28, 2013 at 5:04 a.m.
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GM has manufacturing facilities in many countries where they also sell their products. Some protectionist countries(China) even require it. They are a global company. I doubt any of the cars manufactured in Brazil are sold in the U.S.
Jan 27, 2013 at 10:44 p.m.
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gm has covered up the pollution issues for years. every time there was a change over, the contaminated soil was hauled to a private dump site, east of the city, at night. the city,cared less, as long as they didn't have to deal with it.
Jan 27, 2013 at 9:28 p.m.
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I just read that G.M. is starting a third shift at their brazil plant, way to go G.M.
Jan 27, 2013 at 9 p.m.
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Janesville needs to move forward, and it never will until people get it through their brains that GM is not coming back.
Jan 27, 2013 at 8:47 p.m.
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If GM filled that factory with minimum wage workers it would be open tomorrow! Good luck getting a union to agree to that one ;)
Jan 27, 2013 at 7:45 p.m.
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The unfortunate reality is that while this is a really big thing for Janesville, the decision is being controlled at the national level by GM and its union,” said Vic Grassman, Janesville’s economic development director.
Tell me Vic how does the union control whether GM Janesville reopens? I would like to know the answer to that one. I am sure if the union had a say, it would be open tomorrow.
Jan 27, 2013 at 7:40 p.m.
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Mr Grassman the director for Janesville Economic Development is wrong when he asserts,
“The unfortunate reality is that while this is a really big thing for Janesville, the decision is being controlled at the national level by GM and its union,” said Vic Grassman, Janesville’s economic development director." Mr Grassman the union has nothing to do with GM's plan for their abandon factory. This is entirely a GM issue the union has no say in the buildings future at all. The larger question is how long will GM let this site stay as is? How much pollution is in the ground and beneath the building? Are we living in a city with a toxic Superfund site behind a GM fence? If the site is toxic who pays to clean it up and when does the clean-up start?
Jan 27, 2013 at 7:29 p.m.
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whats hiding under that huge factory? It was built and running full tilt long before environmental regulations were put in place. IMO GM will NEVER close the plant because they don't want to clean it up.
Jan 27, 2013 at 6:27 p.m.
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I know people who worked at a state of the art GM facility that was closed for good. It would be like a dumb government decision to reopen that dilapidated structure.
Jan 27, 2013 at 6:15 p.m.
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Like it or not, the GM plant is a part of Janesville's history and possibly it's future. GM could use it again, sell it, tear it down. Many of us are interested in it's future. If you are annoyed by the Gazette writing articles about it, then don't read the article. Just skip it. I don't read everything in the paper, and I don't become irritated if there is an article I'm not interested in. Chill.
Jan 27, 2013 at 4:37 p.m.
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Why can't the Gazette let it die.
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