Just hours after filing for bankruptcy Monday morning, General Motors announced that it will close or idle 14 plants and three Service and Parts Operations in the United States. Michigan is hit the hardest as it will see five plants being closed while another two factories will be idled. Under the new reconstructing plan, GM will reduce the total number of assembly, powertrain and stamping facilities in the U.S. from 47 in 2008 to 34 by the end of 2010 and 33 by 2012. The automaker said it will achieve full capacity utilization of its assembly operations in 2011, or two years ahead of what was scheduled in its Feb. 17 viability plan submission
GM claims that this will result in lower fixed costs per vehicle sold while it will also have a lower and more efficient capital investment.
“Our manufacturing operations, which already are among the most productive in the industry, will emerge even leaner, stronger and more flexible, as part of the New GM, ” said Gary Cowger Group Vice President of GM Global Manufacturing and Labor Relations. “Flexible manufacturing enables us to quickly respond to consumer preferences and changing market conditions.”
The automaker also reaffirmed its plans to build a new small car (most likely the Chevy Spark) at an unnamed U.S plant instead of China. The site, which will be determined in the future, will be capable of building 160,000 cars annually.
