GM plans to reopen former Tennessee Saturn factory

GM plans to reopen former Tennessee Saturn factory

September 20th, 2011 by Staff Report in News

In this Oct. 3, 2008 file photo, assembly line worker Melvin Matthews, right, uses a large robotic machine to install front seats in a Chevrolet Traverse at the GM plant in Spring Hill, Tenn.

Photo by Associated Press/Times Free Press.

The former Saturn assembly plant in Spring Hill, Tenn., will reopen under the terms of a landmark four-year contract to be submitted to UAW leaders today in Detroit, according to people familiar with the General Motors labor pact finalized last week.

Early reports are that GM wants to use the idled factory to make its hot-selling Chevrolet Equinox, which is made in Canada. The Tennessean newspaper said Spring Hill, about 40 miles south of Nashville, could be an additional production site for the compact crossover.

The newspaper said questions remain about when the work will return and at what cost to the state.

GM made its last Chevrolet Traverse sport-utility vehicle at the Spring Hill plant in November 2009, according to its website. The assembly plant has been on standby since then.

In 2009, General Motors announced that the Spring Hill production facility was to be closed -- costing about 2,000 employees their jobs in the process -- as GM struggled for its financial survival following the credit crunch in 2008.

The plant was originally meant to produce Saturn small cars before that line was discontinued in October 2010. GM continued to produce four-cylinder engines at the Spring Hill site and still runs a stamping plant.

Bill Hagerty, commissioner of economic and community development for Tennessee

Tennessee's chief economic recruiter, Bill Hagerty, was recently in Detroit to discuss state incentives for GM to reopen the former Saturn plant for vehicle production.

GM and UAW leaders reached a tentative agreement Friday night for a new contract, which reportedly includes a provision for GM to rehire workers laid off at the Spring Hill factory.

Rank-and-file members of the union, including those in Spring Hill, are to vote on the tentative pact in the next week.

If the contract is approved as expected, the Tennessean reported that laid-off GM employees who lost their jobs in late 2009 would be rehired, plus GM would set up a "hiring process" to recruit new workers from Middle Tennessee.

GM and UAW officials declined to discuss details of the agreement in advance of submitting the agreement to union members for ratification. But sources said the pact includes $2- to $3-per-hour pay raise for entry-level workers over the life of the contract and guarantees of more union jobs.

GM now has around 2,400 workers making the entry-level wage of $14 to $16 per hour, which is below the $14.50 to $19.50 paid to production workers at the Volkswagen assembly plant in Chattanooga.

Under the proposed UAW contract, GM's 48,500 factory workers will get a $5,000 signing bonus and the possibility of sweeter profit-sharing checks. But most of them aren't likely to see a pay raise.

In response to the labor agreement, GM shares rose nearly 2 percent during an overall down market on Monday, closing up 44 cents per share at $23.05.

GM shares are still nearly one-third below the initial public offering price of $33 per share in November after the old General Motors emerged from bankruptcy.

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