While General Motors, in a move hailed by the United Auto Workers, last night (27 August) announced production of the Cadillac SRX would be shifted from Mexico to Tennessee, the Reuters news agency reported subsequently it had learned the automaker also plans to move some other assembly work from the US to Mexico.
According to the news agency, citing an industry source familiar with GM’s plans, the automaker will shift some production of the Chevrolet Equinox from Spring Hill, Tennessee – where the next generation SRX will be built – to Ramos Arizpe, Mexico, when the Chevy crossover vehicle is redesigned in 2017.
Go deeper with GlobalData
That move could partially offset any new jobs created by the shift of SRX work from Ramos Arizpe to Spring Hill, which is expected in mid-2016, the source told Reuters.
Both GM and the UAW declined to comment to the news agency on whether the Equinox work would move to Mexico.
Reuters estimated the SRX move to Spring Hill would create about 200 jobs at the plant, based on current and projected figures provided by GM. A GM spokesman told the news agency it would be “fair to say” there would be a net increase but would not be specific.
UAW president Dennis Williams said in a statement last night the shift of Cadillac production from Mexico to the United States was “a big victory” for the union but the UAW declined to tell Reuters how many jobs would be added in Spring Hill.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataIn addition, GM told Reuters on Wednesday the current SRX would continue to be assembled in Mexico for an unspecified period of time after the new generation model begins production in Spring Hill.
When GM said – a year ago – it planned to invest $350 million in the Spring Hill plant, which was built originally for the defunct Saturn brand, it noted the plant would be retooled to build two new midsize crossover vehicles. An additional $40m was added to the earlier announced $183m allocation “to support a future mid-size vehicle programme, bringing the new total spend to $223m” expected to “create or retain approximately 1,000 jobs”. A second “mid-size vehicle programme” with a spend of $127m “would create or retain approximately 800 jobs”.
In addition to the new SRX, the plant is expected to build a replacement for the GMC Acadia, according to Reuters’ anonymous source.
GM’s Wednesday announcement of another $185m injection to build a new range of engines in Spring Hill said the engine plant would retain about 390 jobs while the vehicle assembly plant – retooled for the SRX – would require about 1,800 hourly workers.
Reuters said the Spring Hill complex currently employs just over 2,000 hourly and contract workers in vehicle and engine assembly, stamping and moulding operations.
Its source said the automaker plans to build the next-generation Equinox, along with a replacement for the GMC Terrain crossover, in both Ingersoll, Ontario and Ramos Arizpe.
Reuters noted that concessions granted by the UAW to GM before the automaker’s 2009 bankruptcy, including the establishment of the two-tier wage system, helped, during the collective bargaining contract renewal talks in 2011, GM decide to make the Equinox at Spring Hill instead of in Mexico. A key point in the new, four-year agreement GM signed with the UAW in 2011 was new work at several plants, including Spring Hill, instead of pay rises for the automaker’s veteran UAW workers.
GM suspended vehicle production at Spring Hill in 2009 though the plant continued to operate at reduced capacity as an engine plant until 2012 when vehicle building resumed there.
The former Saturn plant was once the site of GM’s experiment with a more collaborative relationship with workers based in part on the model of Japanese automakers led by Toyota, Reuters added.
GM scrapped Saturn in 2009 but, by then, Saturn production had been shifted away from Spring Hill and the plant’s last pre-furlough build was the Chevrolet Traverse.
