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GM adds 2nd shift

1,050 workers to help fill rising Cobalt demand

August 19, 2009

LORDSTOWN - Rebounding demand for the Chevrolet Cobalt, plus the desire for a smooth launch of the all-new Chevrolet Cruze in April, is driving the recall of 1,000 hourly and 50 salaried workers to the General Motors Lordstown Complex Oct. 5, officials said Tuesday.

"It's a great day for us," said United Auto Workers Local 1112 President Jim Graham, whose active membership in the assembly plant will rise to 2,000, leaving about 1,400 still on layoff. He said workers should start getting notified by seniority next week.

"These are people who are going to be paying taxes, putting money back into unemployment instead of taking it out. It's really good for our community, good for the state and good for Lordstown," said Dave Green, president of UAW Local 1714 at the adjoining Metal Center stamping and fabricating plant, where nearly 900 of his 990 members will be back to work. Most of them will remain on five eight-hour shifts a week.

The extra production also means the recall of 200 to 300 workers at four local supply plants, officials said.

Cobalt sales climbed 38 percent in July from June, giving what Lordstown Manager John Donahoe called "a real opportunity for the Cobalt. We have all the right numbers in our quality, our warranty and our cost."

The complex will build about 1,100 Cobalts a day on two 10-hour shifts four days a week, Donahoe said. The current single 10-hour shift of workers still is scheduled for overtime shifts this Friday and Aug. 28, plus possibly more in September, he said.

In addition, the regular 10-hour shifts will be expanded by an hour starting Aug. 31 until a down week starting Sept. 28 to cut the line speed to 54 1/2 Cobalts per hour from 62 cars per hour as part of the preparation for the Cruze launch in April, he said.

"We're setting up the processing with the new body shop, new equipment and the conveyor line at that speed for a high-quality job with the first Cruze," Donahoe said.

Union leaders emphasized the importance of a successful Cruze launch.

"It's imperative that we have a clean and efficient startup on the Cruze because there are other possible (products) sitting out there," said Graham, referring to the possibility Lordstown can secure other vehicles due to the flexibility of its new body shop.

"We can finally build a small car that will have a serious impact on the market," Green said.

The Lordstown production increase was part of GM's boost announced Tuesday that will add 60,000 vehicles in the third and fourth quarters. It will also bring back about 300 laid-off workers at its CAMI plant in Ingersoll, Ontario, Canada, where the new Chevrolet Equinox and GMC Terrain midsize crossover vehicles are made.

GM's announcement came almost a year to the date on Aug. 21, 2008, when then-chief executive Rick Wagoner came to Lordstown to officially announce the complex would build the next-generation Cruze small car. Wagoner was fired by President Barack Obama's Auto Task Force as the automaker filed for Chapter 11 bankruptcy June 1.

Wagoner's visit came only weeks after the complex added a third shift to meet soaring demand for the Cobalt due to record-high gasoline prices. Layoffs began in the fall when the economy plummeted with the credit crisis. One shift of workers returned to the job Aug. 3 after a nine-week total shutdown.

Dealers across the nation have been struggling to find Cobalts, which get as much as 37 miles per gallon, after a surge of sales due to the government's cash for clunkers incentive program that pays as much as $4,500 to people trading in gas-guzzlers for gas-sippers.

Cobalt deliveries by GM to dealers rose to 9,435 in July from 6,847 in June. Year-to-date sales stand at 61,111, which is 53.2 percent below their total in the same period last year.

Graham noted Cobalt sales were rising even before the government program because "it's well-built."

The field supply, or stockpile, of Cobalts at the end of July dropped to 82 days at the current daily sales rate from 155 at the end of June, complex spokesman Tom Mock said. The inventory of the Pontiac G5, which the plant is making in limited numbers for Canada, fell to 55 days from 350. A 60-day supply is considered ideal.

GM said it may boost production at other factories, including those that make the Chevrolet HHR small wagon, the Chevrolet Colorado and GMC Canyon midsize pickups, the Chevrolet Camaro muscle car, Buick LaCrosse sedan and the Cadillac SRX and CTS Wagon.

The automaker's August sales could beat company projections by 50,000, Mark LaNeve, vice president of U.S. sales, said.

The moves come as interest in cash for clunkers may be waning, according to the automotive Web site, because many customers waiting to buy have made their purchase and because inventories have dropped and prices have risen.

Inquiries on the Web site were down 15 percent last week from this year's peak in late July.

Ford Motor Co., Honda Motor Co., Toyota Motor Corp., Hyundai Motor Co. and Chrysler Group LLC all have announced production increases due to the clunkers program.

The Associated Press contributed to this report.



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