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GM bonuses boost Valley economy, confidence



Published: Fri, March 25, 2011 @ 12:10 a.m.

By Ed Runyan

runyan@vindy.com

LORDSTOWN

The money is nice, say area business people, but even better than the $4,000 each that Lordstown General Motors employees are receiving this week in profit-sharing is the resulting consumer confidence.

“The last year has gradually been going uphill, and January and February were record-breaking months for us,” said Bill Rutledge, sales manager at Diane Sauer Chevrolet in Warren. “Every day people are getting a lot more confidence in the economy.”

Rutledge said the positive developments at the GM Lordstown plant, where second and third shifts were returned as the facility ramped up to produce the Chevrolet Cruze last spring, are playing a big role in the local recovery.

The announcement this week that GM employees will receive bonus checks as a result of GM’s turning a profit adds to the good news, he said.

The bonuses should inject an estimated $16 million directly into the Valley economy.

GM employees might be among the people coming to the dealership in the coming months to buy a car or truck, but they might also buy furniture, go shopping at the mall and “spend it in the whole Mahoning Valley,” Rutledge said.

Spending it on furniture or clothing will help workers in those businesses to buy a car, he added.

“Finally, we’re going to see a ripple that’s going toward the positive,” he said, after several years of negative economic ripple effects.

Retirees make up a large percentage of the dealership’s business, Rutledge said, so one of the things that excites the dealership is the likelihood that GM doing well will inspire more consumer confidence among the area’s retirees.

State Sen. Joe Schiavoni, D-33rd of Canfield, said it’s time to celebrate the remarkable comeback GM has made.

“Without the stimulus money, we would not have GM, we would not have Lordstown, we would not have the Cruze, and thousands would not be working. We would not have thousands of bonus checks,” he said of loan money that helped keep General Motors in business.

Jim Graham, president of United Auto Workers Union Local 1112 at Lordstown, said each of the 4,000 local workers is getting about $4,000 in profit sharing, depending on how many hours each worked in 2010.

Josh Aikens, executive director of the Home Builders Association of the Mahoning Valley, said the bonus checks will “give some people the opportunity to save money, to save for a new home, to do remodeling of their current home,” he said.

“What we’re seeing during the economic downturn is everybody has cut back on home expenses in order to make sure the electric bill gets paid, the mortgage bill gets paid and the family gets fed.”

“What people are saying is they’re going to stay in their homes for a few more years,” so they are planning to spend some money to fix them up, Aikens said.

“I think it’s a fantastic shot in the arm,” Ken Kollar, general manager of the Eastwood Mall Complex in Niles, said.

of the profit-sharing.

“It makes people — even non-GM employees — feel better. When GM employees get their checks, it’s going to come back to all of us in dining, cars, the mall. People are tired of not doing things because they didn’t have the money.”


Comments

1lee(544 comments)posted 3 years, 9 months ago

This would be great IF it was not my money

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2Rockabilly(93 comments)posted 3 years, 9 months ago

The American tax payer lent money to GM and much of it has been paid back. That loan has kept millions working, paying taxes and spending money.

Not lending that money would have resulted in those same millions struggling on unemployment. Unemployment is paid for by taxpayers also. The difference is, that money won't be paid back. Which seems like the better plan?

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3Rockabilly(93 comments)posted 3 years, 9 months ago

I don't consider ultra conservative right wing bloggers as a source of information.

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4barackwillfixit(5 comments)posted 3 years, 9 months ago

Where are all of the people in the Valley complaining about those greedy corporate giants paying out hundreds of millions in bonuses now?

I seem to remember that it was "wrong" for JP Morgan Chase or Citibank to pay a bonus out to employees even a year or two ago even after they got the bail out and paid it all back plus interest.

Government Motors still owes us taxpayers millions and they are paying out bonuses. Where are all the liberals to cry that we impose 90% plus tax rates on bonuses like they did to JP Morgan and others? Oh, I forgot, it's okay as long as the union memberships get their share. Bankers are not in unions.

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5Freeatlast(1991 comments)posted 3 years, 9 months ago

Thank you UAW for helping save GM and all the jobs they give to good workers here in the valley . Thank you UAW for taking concessions to save GM and this valley.
I hope next year you get more because it will mean that GM is still doing good .
PLUS thank you for all the money I made on the new stock last month

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63toyo(1 comment)posted 3 years, 9 months ago

I will never own another GM product, P on these people. They owe we the PEOPLE large, I wish they would have gone belly up, Let the Japs buy their crap.

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7MLC75(589 comments)posted 3 years, 9 months ago

I'm glad GM is making money and able to provide bonuses, to the working man and woman.I can't believe all of the hate toward GM.I would rather have my money go to an American company and Americans,rather than some foreign country.

I have always bought GM and will continue and no I don't work in the automotive industry.

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8rocky14(733 comments)posted 3 years, 9 months ago

On the news last night---GM has payed back 23 billion dollars of the 26 billion they got from the government.

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9Freeatlast(1991 comments)posted 3 years, 9 months ago

Thank You UAW for saving the great American company of GM and the jobs of the super guys out at Lordstown and the Valley .
THANK YOU and keep up the great work you do

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10BIGTENFAN(1 comment)posted 3 years, 9 months ago

Yeah right what concession freeatlast you tell that to the retirees and ask them what they gave up to help out on their part compared to some stupid work rules what else did they give I have always owned gm but nomore for me I have gone through 2 company bankrupts and got no where near what these guys got and a US bailout

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