LORDSTOWN — General Motors should decide this year whether to close its Lordstown complex or revamp it for a new vehicle, the complex manager said.
John Donahoe said such decisions normally are made two years in advance and GM has scheduled production of the Chevrolet Cobalt in Lordstown only through summer 2009.
Key to GM’s decision will be a new local labor contract that will be negotiated this year, said Donahoe and union officials who met with reporters Friday.
Donahoe called the physical setup at Lordstown “ideal.” It has a contiguous stamping plant that produces the car’s metal parts and a modern paint shop with technology shared by only three other GM plants.
GM, however, also is looking at how the complex will be staffed in the future, he said. The local contract controls much of that because it covers items such as work rules and job classifications.
In the last contract, workers approved combining some job classifications and changing some rules to allow the complex to run more efficiently. In return, GM invested $1 billion to remodel Lordstown, which is the largest single-line auto plant in the world.
Donahoe and the union leaders wouldn’t discuss specifics about this year’s bargaining, but Jim Graham, president of United Auto Workers Local 1112, said union leaders and workers are prepared to make the plant competitive.
“We can’t afford to do this with a half step because people will catch up with you if you do,” he said.
Graham added that there are measures the company and union can agree on without the union “selling the house.”
He said he’d like to start negotiating next month and wrap up talks before the current contract expires in September.
“Things are starting to snowball up in Detroit as far as new products are concerned,” he said.
Just like five years ago when the complex’s future was in question, Graham is steadfast in his belief that Lordstown will survive.
“We’re going to get a new product,” he said.
What sort of product remains to be seen, Donahoe said. The plant is set up to handle only small and midsize vehicles, so large SUVs and pickup trucks are out, he said.
Other than that, product designs and marketplace demands are too fluid to predict what could end up in Lordstown, he said. No matter what, it will be new model or a totally redesigned model, he said.
Gaining a new product will require an investment in new machinery for the complex, but it won’t be on the scale of the last renovation, he said. The paint shop alone cost several hundred million dollars.
Donahoe said he was pleased with the plant’s performance in 2006 but added that more progress will be expected this year.
The initial quality survey produced by J.D. Power and Associates recorded a 19 percent improvement for Lordstown cars last year, and Donahoe said a double-digit improvement is expected this year.
He said the cost per car produced at the complex was cut by 11 percent last year, mostly because the work force was reduced through the elimination of the midnight shift last July. About 1,600 workers accepted buyout and retirement incentives.
The complex, which has 3,700 hourly workers at the assembly and stamping plants, has regular overtime now with nine-hour shifts each day and extra shifts some Saturdays. Working overtime is less expensive than bringing on more workers, Donahoe said.
The complex produced 278,000 cars last year, including 45,000 Pontiac G5s, which is a sister car to the Cobalt.
Donahoe said GM expects the plant to build 300,000 cars this year, which he considers remarkable with the reduced work force.
The complex used to produce 1,300 cars a day on three shifts. With overtime and an increased line speed, the plant makes 1,154 cars a day.