- The Washington Times - Tuesday, June 2, 2009

The auto industry has dealt tiny Delaware a big blow.

Next month, the first state will watch its last auto plant shut down.

General Motors said Monday that Wilmington’s Boxwood Road assembly plant, which makes the Pontiac Solstice, Saturn Sky and Opel Roadster sports cars, will close at the end of July.

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Once-mighty GM, which filed for bankruptcy protection Monday, also said it would close eight other U.S. plants and idle three others to slash production and cut labor costs. The GM powertrain plant in Spotsylvania County, Va., will close at the end of next year, and a portion of its production will move to GM’s Powertrain Baltimore Transmission plant in White Marsh, Md.

Chrysler’s Newark, Del., assembly plant, which built the Dodge Durango and Chrysler Aspen, closed Dec. 31. At their peaks, Delaware’s GM and Chrysler plants employed nearly 10,000 workers. Chrysler has been in bankruptcy since April 30.

“This is a big hit,” said Alan Levin, director of the Delaware Economic Development Office. Chrysler’s plant opened in 1942, building tanks during World War II. GM’s plant opened in 1947.

The direct and indirect effects of the plant closings could cost the state’s economy about $350 million, from direct and indirect effects, he said. When the Chrysler plant closed, it had 1,100 employees. GM’s Boxwood plant has about 1,000 workers, too.

“On a state with a budget of $3.2 billion, that’s a sizable chunk,” Mr. Levin said.

Around the country, people affected by the plant closings reacted with dismay.

“We’re just waiting to hear … we’re busily trying to understand how we’re going to get paid. I’m spending more time with bankruptcy lawyers and finance people than trying to sell things,” said Damian Ochab, of Farmington Hills, Mich., who works for auto supplier Grainger.

Peter Morici, a University of Maryland business professor, criticized the Obama administration’s trade policies and its handling of GM’s crisis, and offered little hope for auto workers.

“It’s unlikely these plants will reopen, because there’s just too much capacity in North America,” Mr. Morici said. “Even before the recession began, when they were building 16 [million] or 17 million cars a year, there was already too much capacity.”

The Spotsylvania County, Va., plant employs relatively few people, who at least have the advantage of living in an economically vibrant area - recently among the fastest-growing counties in the country, according to the U.S. Census.

The plant made components for four-speed and six-speed truck transmissions, and GM already had announced it was phasing out the four-speed transmissions, said GM spokesman John Raut. Production of the six-speed components will move to the White Marsh, Md., plant, he said.

“There are approximately 67 hourly employees and 14 salaried, and our focus is on making sure their needs are addressed, working with them to make sure they have jobs,” said Russell Seymour, county economic development director.

• Katherine Timpf contributed to this story.

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