GM To Close Louisiana Truck Plant
By Michelle Krebs June 25, 2009
By Michelle Krebs
DETROIT -- General Motors will close its assembly plant and stamping operations in Shreveport, Louisiana, by 2012. The plant currently makes the midsize Chevrolet Colorado and GMC Canyon pickup trucks and Hummer H3 and H3T models.
It looked like only a few weeks ago that the Louisiana plant had dodged the plant-closing bullet when GM announced the sale of its Hummer brand to a Chinese company.
GM said then that if the sale goes through as planned during the third quarter, the Louisiana plant would be making Hummers for the new owner through "at least" 2010. Now the future of the H3, H3T -- as well as GM's small trucks -- is questionable.
Earlier this month, GM confirmed that it had a purchase offer for the Hummer brand from China's Sichuan Tengzhong Heavy Industrial Machinery Co., Ltd., a privately held company that makes heavy-duty industrial equipment. GM said the purchase of Hummer would save 3,000 U.S. jobs.
Since then, numerous press reports out of China indicate skepticism that Tengzhong actually will follow through -- or even be allowed to follow through -- with the purchase of Hummer. The Chinese government reportedly is unhappy that this relatively small company made the Hummer offer outside of the government's plan for its motor vehicle industry. Further, some reports say Tengzhong made the Hummer deal merely to jack up its value.
GM Small Trucks
The closure of the Louisiana plant also prompts questions about the future of GM's participation in the small truck business.
Sales of GM's smaller trucks have been weak, and GM CEO Fritz Henderson has repeatedly said all vehicles in GM's line must "pay their rent," that is be profitable.
The volume leader of the two trucks, the Chevrolet Colorado, has plummeted from a high of 128,508 sales in 2005 to only 54,346 in 2008. The automaker has sold a mere 14,000 of them through May. GMC, which sold a high of 34,911 Canyons in 2005, had yet to sell even 5,000 through May.
GM Small Truck Sales History
|
Year |
Make |
Model |
Total_Volume |
Market Share |
Percent_Of_Make |
|
2004 |
GMC |
Canyon |
30,496 |
0.2% |
5.2% |
|
2005 |
GMC |
Canyon |
34,911 |
0.2% |
6.5% |
|
2006 |
GMC |
Canyon |
23,979 |
0.1% |
5.3% |
|
2007 |
GMC |
Canyon |
20,888 |
0.1% |
4.3% |
|
2008 |
GMC |
Canyon |
14,974 |
0.1% |
4.1% |
|
2009 |
GMC |
Canyon |
4,429 |
0.1% |
4.6% |
|
2004 |
Chevrolet |
Colorado |
127,489 |
0.8% |
4.7% |
|
2005 |
Chevrolet |
Colorado |
128,508 |
0.8% |
4.8% |
|
2006 |
Chevrolet |
Colorado |
93,880 |
0.6% |
3.9% |
|
2007 |
Chevrolet |
Colorado |
75,716 |
0.5% |
3.4% |
|
2008 |
Chevrolet |
Colorado |
54,346 |
0.4% |
3.0% |
|
2009 |
Chevrolet |
Colorado |
13,999 |
0.4% |
2.9% |
Source: Edmunds.com
Ninth Plant Closing
The Louisiana plant becomes the ninth assembly plant on GM's most recent list for permanent closure.
More of GM's "bad" assets are expected to be revealed Tuesday. The automaker outlines to the federal bankruptcy court Tuesday which "bad" assets stay with the old GM and what ones move to the "new GM" under the so-called 363 sale of the automaker's bankruptcy plan. Bad asset will be sold or liquidated.
Photo by GM
1 - The Hummer H3T, climbing precarious heights, has a precarious future.
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