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Local GM plant still hoping for new product

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JAMES P. LEUTE
December 6, 2008
— As General Motors requests a lifesaving infusion of cash from Congress, it's still holding the door open to a proposal to manufacture a new product in Janesville.

Rep. Paul Ryan, R-Wis., and Rep. Mike Sheridan, D-Janesville, the new speaker of the Wisconsin Assembly, both said this week that they have heard from GM officials on the subject.


The good news: GM is not saying "no" to the proposal that Janesville and Wisconsin leaders presented to GM leaders in Detroit on Sept. 12.


The proposal, which is being kept under wraps, would have GM replace the SUV line that ends Dec. 23 with some new product.


"I'd rather have our plans on hold than have them rejected, so we're getting the best we can hope for in Janesville," Ryan said.


The bad news: GM can't do anything with the proposal until its future is secured. GM executives told Congress this week they need $4 billion to avert a cash crisis by the end of this month and as much as $18 billion in federal loans during the next year.


"Obviously, they can't sit around and strategize expansions when two weeks from now they may be in court filing Chapter 11 (bankruptcy)," Ryan said.


The U.S. Senate is expected to vote next week on assistance for GM, Chrysler and Ford.


One thing the assistance package won't include is any requirement that GM do anything in Janesville, Ryan said.


If something were done for Janesville, that would open the door to other states also facing plant closings, Ryan said.


"Our plans are on hold. All of these things are on hold. You can't say, ‘Commit to Janesville or else you don't get this,'" Ryan said. "My (congressional) colleagues won't commit to that because they'll want GM to commit to their towns," and GM is not in any position to be opening plants.


Ryan noted GM's survival plan calls for closing nine more plants by 2012, so talk of a new line in Janesville is premature.


"GM has to survive in order for us to get a positive decision made, that's for sure, and right now GM is in a fight for its survival," Ryan said.


However, Wisconsin lawmakers take every opportunity they have to discuss the Janesville plan with GM executives, Sheridan said.


Sheridan was in Washington, D.C., on Thursday and got into the Senate hearings on the auto bailout with the help of Sen. Herb Kohl, D-Wis.


Sheridan said he got in ahead of the crowd and was lucky to get 20 minutes of face time with GM CEO Rick Wagoner and United Auto Workers President Ron Gettelfinger.


Sheridan, the former president of UAW Local 95, said he has a good relationship with Gettelfinger, who made sure Sheridan was included in an informal discussion.


Sheridan suggested that the new local labor agreement, which was expected to save GM $120 million a year if GM brought new work to Janesville, could become a model nationwide as GM looks for ways to save on production costs.


Sheridan said Ken Cole, GM vice president for global public policy and government relations, spoke highly of the local/state task force making the Janesville proposal.


"They are interested in that, and they really want to do something for Janesville, but obviously there are a lot of problems they need to overcome before they could even think about something like that," Sheridan said.


Task force members just have to wait to see how forces "way beyond" their control play out, said Tim Cullen, who is leading the group with Brad Dutcher, former Local 95 present who now works for national UAW services.


"The news can be discouraging, but it doesn't change what we started out to do," Cullen said. "We knew when we began way back in late June that this was somewhat of a long shot, but we think the proposal we have in front of them is a serious one."


The volunteer task force still meets weekly to discuss courses of action and how to make Janesville more attractive, he said.


Cullen pointed out one clear fact: Even if the group succeeds in bringing a new product to Janesville, there will be an extended period when nothing is produced at the plant after the SUV line ends Dec. 23.


"It's going to be a period of time—whether it's 1 1/2 to 2 years—before there's production of a new product if we are successful," he said.


Reporter Gina Duwe contributed to this story.



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