GM Inside News Forum banner

GM Creates $240 Million Fund "In Case" It Decides To Close Equinox Plant

7K views 24 replies 18 participants last post by  64Rumbler 
#1 ·
Wards Auto News
November 6, 2017

Majoros admits GM may have missed some sales during the inventory crunch and says availability will be tight for several more weeks until the automaker can make up lost output through overtime at Ingersoll, as well as additional imports from two Equinox assembly plants in Mexico.

“It will be a bit of rocky ride,” he tells WardsAuto on the sidelines of a Chevrolet business update here. “But they’re coming. We’ve got a lot in transit.”

The strike by Canada’s Unifor union occurred after it was unable to secure status as GM’s lead Equinox assembly plant. The designation would have given Ingersoll priority over the Mexican plants, where labor is cheaper, if demand weakens and forces production cuts. Workers felt their future was in jeopardy after GM moved all production of the GMC Terrain, a sister vehicle to the Equinox, from Ingersoll to Mexico. The production shift led to the layoff of 600 employees.

Details of a new 4-year contract between GM and Unifor at Ingersoll were not released, but the automaker reportedly created a $240 million fund to support workers should it decide to close the plant.



.
 
#2 ·
Re: GM Creates $240 Million Fund "In Case" It Decides To Close Equinox Plant

Details of a new 4-year contract between GM and Unifor at Ingersoll were not released, but the automaker reportedly created a $240 million fund to support workers should it decide to close the plant.
Un cuarto de billón de dólares reservados "en caso de que" GM decida mover toda la producción de Equinox a México. Incluso para GM, eso es un poco de cambio. Parece que los trabajadores de Unifor en Ingersoll deberían postergar la planificación a largo plazo.*

*(A quarter billion dollars set aside "in case" GM decides to move all Equinox production to Mexico. Even for GM, that's a bit of change. Sounds like Unifor workers at Ingersoll should hold off on long term planning.)




.
 
#4 ·
Re: GM Creates $240 Million Fund "In Case" It Decides To Close Equinox Plant

Accounting rules dictate that a reserve be set up when the likelihood of an even is probable AND the cost is reasonably estimatible.

However, there is a lot of leeway in actual practice in both the $$ amount that is actually used vs. what was reserved for and the timing. This reserve could be for when the 4 year contract is up, the creation of the reserve today could just mean GM thinks it is very likely they will shut it down in 4 years.....
 
#6 ·
Re: GM Creates $240 Million Fund "In Case" It Decides To Close Equinox Plant

Accounting rules dictate that a reserve be set up when the likelihood of an even is probable AND the cost is reasonably estimatible.

However, there is a lot of leeway in actual practice in both the $$ amount that is actually used vs. what was reserved for and the timing. This reserve could be for when the 4 year contract is up, the creation of the reserve today could just mean GM thinks it is very likely they will shut it down in 4 years.....
And it is not a 100% given that it will be used. Reserves can be reversed if better information comes to light, such as increasing sales.
 
#9 ·
Re: GM Creates $240 Million Fund "In Case" It Decides To Close Equinox Plant

The 240 million isn't new. It's only being increased per the contract to make it more expensive to close CAMI. This is what Unifor and GM agreed to. This doesn't mean GM is going to closet plant.

Instead of closing Ingersoll or Lordstown I have a novel idea, why not grow the business and put new products in these plants? What about new small and large vans? How about GM build their own medium duty trucks instead of outsourcing these to Navistar (who is in the process of getting bought out by VW)? What about a minivan? How about extra capacity for the Colorado/Canyon? What about exports to the rest of world like Australia and New Zealand? How about relaunching Chevrolet in Europe and exporting genuine American made Chevrolets there?

Seems like it's easy to cut and run these days instead of taking the road less traveled.
 
#10 ·
Re: GM Creates $240 Million Fund "In Case" It Decides To Close Equinox Plant

The 240 million isn't new. It's only being increased per the contract to make it more expensive to close CAMI. This is what Unifor and GM agreed to. This doesn't mean GM is going to closet plant.

Instead of closing Ingersoll or Lordstown I have a novel idea, why not grow the business and put new products in these plants? What about new small and large vans? How about GM build their own medium duty trucks instead of outsourcing these to Navistar (who is in the process of getting bought out by VW)? What about a minivan? How about extra capacity for the Colorado/Canyon? What about exports to the rest of world like Australia and New Zealand? How about relaunching Chevrolet in Europe and exporting genuine American made Chevrolets there?

Seems like it's easy to cut and run these days instead of taking the road less traveled.
+1 , It could be a good plan if it's well executed. (As for Navistar getting bought out by VW, how's the plans goes since the volkswagate/dieselgate)

A plant who could be closed and that'll make Coleman A. Young spinning in his grave is closing the Hammtramck plant, repairing a big mistake.
 
#12 ·
Re: GM Creates $240 Million Fund "In Case" It Decides To Close Equinox Plant

The Unionista Grand Poobahs timed their little walk-out at a peculiarly awkward moment.

If you have a hot-selling NEW car and your "prime plant" workforce walks out...well, GM Management may not be Einsteins but 2+2 still =4.
 
#13 ·
Re: GM Creates $240 Million Fund "In Case" It Decides To Close Equinox Plant

I like this bit in the article.... "....The Equinox also was completely redesigned a few months ago and occupies one of the industry’s hottest segments, which combines to lift demand even higher. ...."

The increasing speed of development of motor vehicles never ceases to amaze me. ;)
 
#14 ·
Re: GM Creates $240 Million Fund "In Case" It Decides To Close Equinox Plant

I like this bit in the article.... "....The Equinox also was completely redesigned a few months ago and occupies one of the industry’s hottest segments, which combines to lift demand even higher. ...."

The increasing speed of development of motor vehicles never ceases to amaze me. ;)
Interesting I had a 2018 Equinox loaner yesterday. Rides pretty nice but I thought some of the dashboard and door pieces looked kind of cheap. What probably sells people is the space inside - surprisingly big interior.
 
#16 ·
Re: GM Creates $240 Million Fund "In Case" It Decides To Close Equinox Plant

We have had Equinox's on the lot for many months with no interest at all till last month when the rebates got strong. Our old Equinox owners do not like that its "smaller" than there old one and many dont like the roof rack missing unless you order a high dollar unit.
 
#19 ·
Re: GM Creates $240 Million Fund "In Case" It Decides To Close Equinox Plant

We have had Equinox's on the lot for many months with no interest at all till last month when the rebates got strong. Our old Equinox owners do not like that its "smaller" than there old one and many dont like the roof rack missing unless you order a high dollar unit.
The teardrop slop that the rear roofline gets doesn't do it any favors; regarding the roof rack, is it just me, or do the cross bars look like something someone bought out of the JC Whitney Catalog?



 
#17 ·
Re: GM Creates $240 Million Fund "In Case" It Decides To Close Equinox Plant

$240 million, How many Peso's is that?

CAMI, and Oshawa, is all but Boarded Up. A wise use of Canadian Tax dollars! $240 Million is 1/3rd of what Canadians lost with the Bail Out

http://www.detroitnews.com/story/bu...09/canada-loses-canadian-gm-bailout/25559951/

I will tell more than 2 friends GM, Canadians might be kind, but we ain't dumb.
 
#24 ·
Re: GM Creates $240 Million Fund "In Case" It Decides To Close Equinox Plant

Unifor over-played their hand. Simple as that.

This vehicle is still selling well, and can be sourced from multiple plants. But if you try to muscle GM, this is the sort of response you should expect with nothing more than a modest hand of cards. I am not surprised that this could happen. CAMI had a cost advantage that no longer exists, and their quality hasn't been so much better that you wouldn't consider other plants. Those previous gen Equinoxes have a bad reputation, ongoing. This is about the future, and just having Unifor pushing could doom them. It's not needed today. Perform, and this will work itself out.
 
#25 ·
Re: GM Creates $240 Million Fund "In Case" It Decides To Close Equinox Plant

The fund was negotiated by Unifor to allow senior members to retire should there be a slow down in production, there are over 1500 members eligible to retire during the life of this contact and this insures they all reach 30 years of service.
 
This is an older thread, you may not receive a response, and could be reviving an old thread. Please consider creating a new thread.
Top