General Motors plans to invest about $YS225m in its Spring Hill manufacturing complex to renovate the plant's paint shop in preparation for future vehicle production. The investment is subject to GM securing incentives from the state of Tennessee.

"GM's planned $225m investment in Spring Hill is proof that this facility remains an important part of GM's North American manufacturing plans," said GM vice president for manufacturing and labor relations Tim Lee. "This project is instrumental to GM's efforts to strengthen its core manufacturing capabilities in the United States and also demonstrates the value GM places on working together with our UAW partners to improve our manufacturing operations."

Spring Hill built its first vehicle on 30 July, 1990. Since then, the complex has built and shipped more than 3.4m vehicles. It currently builds the Saturn Ion passenger car and Vue compact SUV. Production of both will be discontinued in late March 2007. GM will replace the Ion sedan with a rebadged GM Europe Opel Astra hatchback line imported from Germany and move the 2008 Vue to Mexico.

With the investment, the plant will be idled for several months for renovations, beginning in April 2007. The company is finalising the timing of when the hourly workforce will be called back to work and when production will resume at Spring Hill.

The plant employs approximately 3,500 UAW-represented hourly staff and 230 salaried workers.

A report on The Car Connection (TCC) website noted that GM's board of directors last month ended plans for a new minivan that was supposed to be built in Spring Hill once production of both the Ion and Vue had ended next year. The decision to kill the minivan project left the Spring Hill plant without a future product, raising the possibility that GM could close the plant permanently in 2008 once GM re-negotiated its contract with the United Auto Workers, the website said.

 The reported added that GM officials, however, insisted that while Spring Hill might not necessarily build a Saturn vehicle, it will continue to build GM vehicles in the future.

A GM spokesman told TCC last night he could not say which kind of vehicle is slated for future production but the website, citing hints from GM's designers and executives, speculated it would be a small passenger car or tall wagon that could replace the axed minivan.