NEW YORK (CNNMoney.com) -- General Motors announced plans Tuesday to shut four truck and SUV plants that employ thousands of workers. It also said high gas prices are here to stay - and, with them, consumers' growing preference for more fuel-efficient vehicles.
The plants to be closed include two U.S. facilities: The Moraine, Ohio plant that builds midsize SUVs, such as the Chevrolet Trailblazer and GMC Envoy; and the Janesville, Wisc., assembly line that builds large SUVs such as the Chevy Tahoe and Suburban and GMC Yukon.
In addition, it plans to close a pickup plant in Oshawa, Canada, and a truck plant in Toluca, Mexico.
The Mexican plant that builds medium-duty trucks sold to businesses rather than consumers will close later this year. The other plants will close in 2009 and 2010, with sooner closings possible if sales do not improve. Each U.S. plant has about 2,500 employees.
Posts: 17019 | Location: Lincoln Place, Granite City, IL, USA | Registered: 06-03-02
GM is having its fanny kicked by every foreign-based manufacturer with a US plant. And it's no surprise, I suppose, that its SUVs are having a hard time with $4/gallon gasoline.
Our own local economy, once nearly immune to plant closings, will lose a furniture plant in October and has just announced a textile plant closing. Needless to say, foreign competition has hit these two sectors hard. The combined job losses are over 2% of our County workforce.
I don't suppose we want the good news about new manufacturers relocating here?
Posts: 7739 | Location: in the backwoods of North Carolina | Registered: 06-07-02
This is good news for the Democrat Party. Especially the Environmentalist. GM is shutting down plants that manufacture all these gas guzzlers that pollute the air and creating more greenhouse gasses.
Posts: 2277 | Location: Martinsville, IL | Registered: 06-03-02
Less pollution is good news for everybody, isn't it?
It's surely a sign of GM's general ill-health that its response to a demand for smaller and more efficient cars is only to stop making the larger and more wasteful ones.
LR, I would have thought you'd be happy to see the free market at work. WHat happened here is nothing more than the result of a company responding to consumer response to one of their products. Reports by people whose business it is to know about such things say that ANWAR oil would make about a ½% difference in the price of gas, and that difference would only last about 12-16 months. Given that information, it's hard to blame environmentalists for people not buying enough SUVs, or for a company looking ahead and seeing that its economic health would be better served by cutting back on producing gas guzzlers.
At the risk of sounding like a broken record (like that's stopped me in the past), I remind you and anyone else reading this that, if more people would have listened to the tree-hugging nuts like me back in the early 70s (when I first thought about the fact that there is a finite amount of oil, and a demand for that oil that was headed towards being infinite), we wouldn't be in the boat. All it took was looking at the facts, and seeing where demand was headed. But not enough of us did. Not enough of us pushed for developing feasible alternative energy sources.
As for the Democrat benefiting, all I can say is that the party out of power always benefits from economic bad times. Whoever was president at this time would have hurt his party; the fact that this time it is a very unpopular president will just make matters worse for his party. It's similar to the free market. If people don't want it, they won't buy it.
Posts: 17019 | Location: Lincoln Place, Granite City, IL, USA | Registered: 06-03-02
Forget factory closures, the problems of small farmers,globalisation and gas prices.
Here's a real problem.
Local TV for this region, East Anglia,has just reported a true disaster.
Pubs in this region are closing down because of 'increasing costs' !
[The report didn't bother to explain that pubs have been closing down for decades.The reason is culture, not cost.The best will always survive, whatever the 'costs', because they have adapted to the modern, and changing, market]
Originally posted by juanruiz: I thought that the textile industry in the Carolinas got slammed years ago.
Yes, and the furniture industry has been slammed during the past 8 years. Our county's facilities are more specialized and we were able to avoid the plant closings until the past year. Fortunately, there are other manufacturers looking to expand here so the net job losses will be minimal (and the wages will likely be higher).
Posts: 7739 | Location: in the backwoods of North Carolina | Registered: 06-07-02
DG-This does not shake my belief in the free market system. Actually it reinforces it. It illustrates how even a huge corporation which has been grossly mismanaged for decades, caught unprepared for changing market conditions, eventually has to make drastic changes if they want to survive.
While the CNN link you posted puts an economic spin on the story, the article provided by juanruiz really gets to the heart of the matter. That is the union membership. I notice how the plant closures are taking place once the contract with the UAW expires. The unions have become such a problem to the American auto industry, we may eventually no longer have an American based auto industry. The American auto manufacturers are very bogged down in health care & pension issues for retired union members. I see this as a step to downsize the union ranks they employee.
You also discuss the need for alternative fuel sources. I am all for that too. And there has been a certain amount of R&D work on this type of technology since the early '70's. Much of it never makes it to the market place for a variety of reasons. Costs are definitely a factor. Also much of the research done is still in development and the products in development are not ready to be brought to the marketplace yet.
Right now we are in a transition period concerning the use of ethanol. For years we were told we need to go towards more ethanol use. Over the past few short years, more ethanol plants have been built. Million$ of dollars in private investment has gone into these plants. Now the problem is what it has done to corn prices, the domino effect to other food costs as well.
Perhaps we should study the country of Brazil and their use of ethanol I think there are some lessons we could learn from them...
In the mean time we still need oil to maintain our economy. Even if we go to totally nuclear power plants, which would be a good thing, use more ethanol based fuels to run our cars, we still need oil. So much of everyday items we don't even think about is pertoleum based. Our clothing, the carpeting we walk on in our homes, plastics, just to name a few. We're not ever going to be in the position to get away from oil.
We need to lift environmental restrictions in such places as ANWR. The oil we have there is not doing us a bit of good sitting underground. We need to develop it & produce it. So for now we will continue to keep making the overseas producers richer while we sit on our hands & do nothing with our own resources.
Posts: 2277 | Location: Martinsville, IL | Registered: 06-03-02
Concerning my previous post where I discussed Brazil's ethanol industry, I found a couple of article on the critical side. Some might find of interest.
We need to lift environmental restrictions in such places as ANWR. The oil we have there is not doing us a bit of good sitting underground. We need to develop it & produce it. So for now we will continue to keep making the overseas producers richer while we sit on our hands & do nothing with our own resources.
Who owns "our own resources" ?? I thought the natural resources belonged to the "people" ultimately. Don't they?
We need to lift environmental restrictions in such places as ANWR. The oil we have there is not doing us a bit of good sitting underground. We need to develop it & produce it. So for now we will continue to keep making the overseas producers richer while we sit on our hands & do nothing with our own resources.
Who owns "our own resources" ?? I thought the natural resources belonged to the "people" ultimately. Don't they?
Not necessarily. On government owned lands, does the government own the mineral rights beneath them??? What I am getting at if some land, the government owns, was purchased by individuals or even corporations, the seller could still retain ownership of the oil & mineral rights.
Posts: 2277 | Location: Martinsville, IL | Registered: 06-03-02
It seems to me that, while the free market/private enterprise system has much to recommend it, it also requires some restraints. Competition between several retailers, for example, may help to reduce prices, but cooperation between those same retailers can cannibalize the smaller players until we have only one giant, big box store. Automobile manufacturers can "cooperate" to buy members of congress and impede and defeat public transport systems. The proper role of government, in my opinion, is to serve the needs of the majority of its citizens. The same people who drill for oil in the ANWR, are the people who drill for oil anywhere and everywhere they can - if we let them.
The only problem is, we don't seem to want them to drill anywhere at all, in the United States.
Did I hear that Cuba is giving someone the right to drill for oil that is only 50 miles off of the Florida coast, in an area where we will not allow drilling? I would like for someone with the facts on this to provide them.
Isn't ANWR about a bazillion miles from civilization, in the frozen tundra of northeastern Alaska?
With all of the oil rigs in the Gulf of Mexico during Hurricane Katrina, did Katrina cause any major spills that harmed the environment?
Methinks the pendulum has swung too far in one direction.
Posts: 7739 | Location: in the backwoods of North Carolina | Registered: 06-07-02
fuse-We already have existing oil production in Alaska. Oil from ANWR could be pipelined to existing facilities that is already in place to handle oil.
You asked about spills by Hurricane Katrina. Here is an article that discusses your question...
"DG-This does not shake my belief in the free market system. Actually it reinforces it. It illustrates how even a huge corporation which has been grossly mismanaged for decades, caught unprepared for changing market conditions, eventually has to make drastic changes if they want to survive."
That was my point, LR. The fact that GM is just now seeing what some saw almost 40 years ago might give pause to potential stock owners. Of course, the same could be said for all the American auto companies. Almost any business owner can react to market changes when they effect his bottom line. Smarter ones react to future changes, and, as I said, this change did everything but hold a press conference to announce it was coming.
Regarding ANWAR, in another thread, it was shown that ANWAR oil would lower the cost of gas in this country by about ½%. At $4 a gallon, we'd be saving 2 cents a gallon. Yep, that'll solve the problem.
In that same thread, I mentioned that a company had been trying to get investors for a refinery in the US for about 10 years, but hadn't done it yet. Isn't that, too, an example of the free market? (I noted today or last night that a city in one of the Dakotas is allowing a refinery to be built in or near their city. If I see it again, I'll post about it.)
Posts: 17019 | Location: Lincoln Place, Granite City, IL, USA | Registered: 06-03-02
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