Janesville50°

More than 750 jobs expected to be lost as GM plant drops to one shift

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JAMES P. LEUTE
April 29, 2008
— General Motors officials estimate that 756 jobs will be lost when the automaker eliminates a production shift at its Janesville plant in July.

At least that’s the number the automaker is giving the state under the Worker Adjustment and Retraining Notification Act, which requires employers to provide 60 days notice in advance of a mass layoff or plant closing.


The number may change.


“It’s very fluid at this point,” said Mary Fanning, spokeswoman for the Janesville plant.


GM announced Monday that sagging sales have forced it to permanently drop second-shift production starting the week of July 14. The surviving shift will comprise employees from both the first- and second-shift based on seniority.


GM also announced it would eliminate production shifts and 2,800 jobs at pickup truck plants in Pontiac and Flint, Mich., and Oshawa, Ontario.


But among three plants that build full-size sport utility vehicles, the Janesville plant was the only one tagged for production cuts.


Fanning said that in addition to 2,640 hourly employees, the Janesville plant has a salaried workforce of 195 that also would be trimmed.


A reduction of 756 hourly workers would result in a local workforce of 1,884.


Monday’s announcement included an increase in the speed of the plant’s assembly line, from the current 44 jobs per hour across two shifts to 58 trucks per hour on one shift.


As recently as last year, the plant was building 58 jobs an hour. That eventually fell to 52 jobs per hour and then to 44 earlier this month.


Over the course of two 10-hour shifts each day, workers typically turn out 880 SUVS. But starting in July, the plant’s one shift will produce 580 vehicles a day.


Whether the local plant needs nearly 1,900 hourly employees to build 580 trucks remains to be seen. Fanning admitted discrepancies between Detroit and Janesville on the number of hourly employees at the plant, and it’s possible that more than 756 employees will be affected.


A pending attrition program that ends in Janesville in May also will play a role in determining the plant’s future employment.


Plant manager Gary Malkus said in a letter to employees that a weak economy and rising gas prices forced GM into the cuts.


“… This is a very emotional and difficult announcement to make,” Malkus wrote. “I want to recognize that the entire Janesville assembly team has worked diligently to improve health and safety performance, quality, reduce unnecessary costs and run the plant efficiently.


“… Rest assured that this change is not a reflection on our great Janesville workforce.”


GM officials in Detroit said the cuts at the four plants will take 88,000 pickups and 50,000 SUVs out of production.


For the first three months of the year, GM’s pickup truck sales were off 15 percent, while SUV deliveries were down 26 percent. Despite the decreases, GM still is the segment leader, with a 40 percent market share of full-size trucks and more than 63 percent share in the full-size SUV market.


“With rising fuel prices, a softening economy and a downward trend on current and future market demand for full-size trucks, a significant adjustment was needed to align our production with market realities,” Troy Clarke, president of GM North America, said in a statement. “This is a difficult move, but we remain committed to retaining and growing our leadership position in the full-size truck market.”


Clarke said details on workforce reductions will be hammered out with representatives of the United Auto Workers and Canadian Auto Workers.


The decision to cut production in Janesville apparently was the result of a scheduling meeting last week in Detroit. Until Monday’s announcement, few knew of the automaker’s intentions.


Rumors circulated that the plant would suspend all production until the July switch to one shift.


But that isn’t the case, Fanning said.


As long as the UAW strike against American Axle continues, the Janesville plant will not have enough parts to run two full shifts, she said. Until July, the plant will continue with its one-shift-on, one-shift-off production strategy. For example, second-shift workers are on the job this week while first-shifters are laid off.


If the American Axle strike settles before July, GM corporate officials will reconsider the production schedule in Janesville, Fanning said.


Read more in our special section on the GM cutbacks.

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