GM Sticks With Sweden Plant
April 19, 2007

Within General Motors’ announcement this week of investments in plants and next-generation models worldwide was the largely overlooked fact that GM has further committed to Saab with a new car and with a future for Saab’s assembly plant in Trollhättan, Sweden.

Speculation has swirled for years that Swedish automaker Saab would no longer build cars in its homeland and its Trollhättan plant was doomed as GM shifted to global platforms and moved future production for its 9-3 and 9-5, based on the Opel Vectra, to Germany.

Not so with this week’s announcement. The Trollhättan plant will make a new compact car to slot beneath the current Saab 9-3. The car will be based on the next-generation Opel Astra. The Astra also will be sold later this year as the Saturn Astra in North America.

GM announced this week that it would replace the existing Astra in early 2010. The automaker said it would invest 3.1 billion euros in the compact car, which will be assembled in Germany, the United Kingdom, Poland and Sweden.

The news about Saab, extensively covered and hailed in Sweden, was largely overlooked in other geographies because, at the same time, GM announced it was cutting back production at its Antwerp, Belgium, plant and eliminating 1,400 jobs. The Belgian plant produces the current Astra but will not make the next-generation model.

GM’s move grabbed headlines worldwide because on the same day that it announced job cuts in Belgium, the company revealed growth plans for India and China. Clearly, GM is indicating its intent to move jobs and resources to the growing East and away from the mature, high-cost markets of North America and Western Europe.

GM said it would double production capacity to 1 million units annually at its factories in China by 2010. GM further said India, forecasted to be the second-fastest-growing auto market behind China, would become a production hub for the company to sell cars worldwide. 

Interestingly, GM unveiled three minicar concepts at the recent New York auto show, one of which was built in India. GM designers wanted to do three cars based on the same Korean-built architecture but didn’t have enough money for all three, until they found a third could be made in India and fit their budget.

GM is trying to spur continued growth in Asia to fend off Toyota, threatening to be No. 1 among global carmakers as early as this year.

Posted by Michelle Krebs at 5:40 AM under Analysis , GM | Comments (0) | digg this | Seed Newsvine