Michigan wins car race

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By Kathy Barks Hoffman and David N. Goodman ASSOCIATED PRESS

ORION TOWNSHIP, Mich.

Michigan has snatched back a few of its fast-disappearing auto jobs, winning a high-stakes competition with two other states to build General Motors Corp.'s next-generation subcompact car.

The news is a bright spot in an otherwise gloomy Michigan economy that has seen unemployment hit a nation-leading 14.1 percent, lots of housing foreclosures, unpaid furlough days for state workers and uncertainty for thousands of others worried about whether they'll still be getting a paycheck in the months ahead.

GM said Friday it would use an idled midsize car plant in Orion Township, about 40 miles north of Detroit, to assemble small and compact cars. The automaker also had considered plants in Janesville, Wis., and Spring Hill, Tenn.

GM said it expects to start retooling the Orion assembly plant in late 2010, and run two shifts there by 2011, producing 160,000 vehicles annually. The move will save 1,200 jobs.

"We're delighted," Oakland County Executive L. Brooks Patterson said. "I think the impact of reopening that plant and making the small car here will have a huge long-term effect not just on Oakland County but southeast Michigan and help us address some of the real serious employment issues that we have in this region."

A spokesman for Wisconsin Gov. James E. Doyle, a Democrat, said GM Manufacturing Vice President Tim Lee told the governor Friday morning that the automaker had chosen Michigan.

"I am deeply disappointed by GM's decision not to reopen the Janesville plant," Mr. Doyle said in a written statement. "Because GM in recent bankruptcy proceedings announced closing seven plants in Michigan and the Orion plant was in current operation, we knew it would be an uphill battle."

Tony Medrano, an hourly employee at the Orion Township plant, called it "awesome news." The Orion plant now makes the Pontiac G6 and Chevrolet Malibu midsize cars, but the Pontiac brand is being discontinued and the Malibu also is made at a factory in Kansas City, Kan. The plant was to go on standby status later this year.

Mr. Medrano, who has worked for GM for eight years, was one of the plant workers who accompanied Michigan Rep. Gary Peters, a Democrat, to GM's headquarters recently to deliver letters to company officials pressing for bringing small-car production to the factory.

He's unsure about the future of his job because it's not clear whether the plant will need the same number of workers as it has now. But he said he still wanted Orion Township to get the chance to build the 160,000 small cars annually.

"We figured the push for this vehicle was more important than our jobs," he said.

Auto workers weren't the only ones heartened by the news. Ron Basar, a 44-year-old engineer with the auto parts supplier Inteva Products, said landing the small car was "quite a relief."

His company faced shutting at least one of its plants had the Orion Township plant closed, and the township would have suffered a big blow to its finances.

"Without that tax base, it would be pretty devastating," he said. "We really need them in the area."

Michigan has lost nearly half its manufacturing jobs since they hit a peak in mid-2000 - more than 450,000 positions. At least half a million workers already are collecting unemployment benefits in the state, so holding onto at least some of the GM jobs it thought it was losing is a major victory.

GM also said a building at its Pontiac stamping plant will be retooled to make parts for the new car based on the Chevrolet Spark. GM said 200 jobs will be spared at the stamping plant center.

Michigan's win meant a loss for workers hoping GM would reopen the Janesville plant or spare the Spring Hill plant where 2,500 workers will lose their jobs later this year when production of the Chevrolet Traverse crossover vehicle moves to a plant near Lansing, Mich.