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2006 job picture for GM plant remains murky
Only 20,000 Pontiacs scheduled

By LULADEY B. TADESSE
Staff reporter
02/10/2004

Within two years, General Motors Corp. plans to spend $50 million to convert its plant near Newport to manufacture several small, niche vehicles.

Yet the company has announced no plans for the Boxwood Road plant in 2006 other than building the Pontiac Solstice, a sports car that, at most, would keep the plant busy less than half a year. GM said it is uncertain whether it will produce other vehicles at the plant that would share components with the Solstice, such as the frame and suspension.

The transformation of the Newport plant, which now employs nearly 1,200 assembly workers, into a low-volume facility could lead to fewer jobs. GM officials said they don't yet know how many workers will be needed in Newport.

"We don't have the manpower issue resolved," said Dan Flores, spokesman for GM Manufacturing. "The actual manpower numbers are still part of the studies that have not been finalized yet."

The Saturn plant contributed about $315 million to Delaware's economy in direct and indirect jobs last year, according to the Delaware Economic Development Office. The average wage of an assembly line worker at the plant was $26 an hour.

Several factors, including the type of product being built, the number of parts needed and the market demand for the vehicle will determine the number of workers needed, Flores said.

"There are still unknowns," said Dennis Dougherty, who took over as plant manager on Feb. 1. "It's a competitive world, and because of that, I don't think there is ever a point where you should not be concerned."

Next year, GM will phase out the Saturn L-series, which it currently makes on Boxwood Road, and begin making the Solstice for the 2006 model year. The state's congressional delegation and top officials joined GM representatives at the plant Monday to mark the start of preparing the site for the new sports car. Workers were shown a prototype by Pontiac general manager Jim Bunnell, plant spokeswoman Alice Petitt said.

Still, GM is expected to make only about 20,000 Solstices a year in Newport - 8 percent of its 249,288 annual capacity, according to 2002 plant capacity figures from Harbour and Associates Inc., an auto industry consulting firm in Troy, Mich. The plant's assembly workers currently produce 235 vehicles a day on one shift. At that rate, the plant would produce in four months enough Solstices for a year.

Analysts said producing the Solstice alone would not be an efficient use of the Newport plant.

"They will need fewer people or more volume," said Laurie A. Felax, vice president at Harbour. "Obviously, the goal here is not to eliminate jobs. It is to find more product to put in that plant so that they can keep the plant."

GM has said nothing about what other vehicles, if any, it plans for the plant.

"There is certainly a possibility there could be other Kappa-based products that could be built in Wilmington, but there is nothing approved right now beyond the Solstice," Flores said. Kappa is a new platform designed to make rear-wheel-drive cars. The Solstice, a two-seater, will be the first GM car to use the Kappa architecture.

Last month, GM unveiled two concept cars based on Kappa architecture: the Saturn Curve and Chevrolet Nomad. If those cars are ever built, it could be in Newport.

Some analysts said the company's $50 million investment toward a new body shop and assembly line at Newport means it has high hopes for the plant.

"There will be other vehicles coming off the platform," said Guido Vildozo, automotive market analyst at Global Insight, based in Lexington, Mass. He predicted that Newport will build three cars from different brands, possibly a Saturn, Chevrolet or Buick, and Pontiac.

Jeff Brodoski, auto analyst at J.D. Power and Associates, an auto research and forecasting firm in Troy, Mich., said GM could begin building another car at Newport 12 months to 18 months after it begins producing the Solstice. "We don't expect it to take years before they add another vehicle," he said.

Even if other vehicles are produced in Newport, analysts don't expect the total number of cars produced at the plant to exceed 50,000 vehicles a year. The plant produced 45,440 L-series cars last year although it was shut down for 15 weeks.

GM has at least two plants that make fewer than 50,000 vehicles a year. Each has fewer than 1,000 workers.

Full Article Here

 

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So why don't the pinhead suits Ok the Chevy Nomad (a home run) for the plant? ANSWER: They are GM pinhead suits thats why. After two or three years of arguing and lots of three martini lunches they might decide, why don't we build the Nomad. Meanwhile there will be RWD BMW 1 series all over the place and do not rule out Japan. If they get a wiff that a kappa type vehicle works in the USA you know they will have something out very quickly. Unlike GM suits the **** don't screw around when they sense market share to be gained.
 

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Originally posted by yoblues@Feb 10 2004, 04:03 PM
So why don't the pinhead suits Ok the Chevy Nomad (a home run) for the plant? ANSWER: They are GM pinhead suits thats why. After two or three years of arguing and lots of three martini lunches they might decide, why don't we build the Nomad. Meanwhile there will be RWD BMW 1 series all over the place and do not rule out Japan. If they get a wiff that a kappa type vehicle works in the USA you know they will have something out very quickly. Unlike GM suits the **** don't screw around when they sense market share to be gained.
Although there's nothing official, you know there will be variants! On FOX NEWS Channel the other day, they did a piece on Saturn being turned into a division from a wholly owned company... they added TWO TIMES hinting to a quote "small coupe" and a few otherkey product launches to "double Saturn sales by the end of 2005 to over 500,000 units." :)
 

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I think this new-fangled Solstice will sell every one of its 20,000 units per annum goal- without incentives.

Hmmm, even if Saturn gets a swank Kappa car, I'm not seeing 500,000 units/year at any point for this critically ill division. As much as I hate to say it, Hyundai/Kia, for example, has a much better chance of seeing 1,000,000 units/year in the US than Saturn has of seeing half that amount.

But, we have the fantastic Solstice!
 

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I think im one of the very few that dont like the Nomad. I mean I dont like it all. I like the Curve and wish that they can do that. Saturn needs a large sedan big time, and they need it quick. If they think that they can get to 500k with the vue and the ion they are crazy. Even with the van they are still under the wire. Saturn can be saved if GM gave them a bit more attention. I liked the L series sedans, and dont know why they failed? They look really nice from the outside at least. We know that Saab is gunna get one for over seas.

They just had a whole thing about kappa on speed tv. That show Autoline Detroit had some lady from GM talking about the chassis. These 2 guys from car and driver and motor trend were like grilling her!! She seemed overwhelmed with questions.
 

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I thought there was a news article on this site saying the Curve and Nomad will be produced.
 

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Originally posted by bigals87z28@Feb 10 2004, 12:39 PM
I think im one of the very few that dont like the Nomad. I mean I dont like it all. I like the Curve and wish that they can do that. Saturn needs a large sedan big time, and they need it quick. If they think that they can get to 500k with the vue and the ion they are crazy. Even with the van they are still under the wire. Saturn can be saved if GM gave them a bit more attention. I liked the L series sedans, and dont know why they failed? They look really nice from the outside at least. We know that Saab is gunna get one for over seas.

They just had a whole thing about kappa on speed tv. That show Autoline Detroit had some lady from GM talking about the chassis. These 2 guys from car and driver and motor trend were like grilling her!! She seemed overwhelmed with questions.
BigAL I once again agree with ya,haven't seen the interview yet though :( .
 

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gm is nuts the soltice is going to exceed 100,000 units because everyone wants one i have four friends in business waiting. Man they better sell all they can and make money off this car before Toyota catches up. This is the car that everyone wants and make the money count on this G.M. Get ahead on this one dont make another mistake.
 

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The Kappa line is capable of putting GM into the small car market in a huge way. Why put production limits on an affordable car?
GM should build as many models as it can, convertible, coupe, sedan, hatchback, two door wagon, four door wagon.
The solstice is a great looking car. The Curve and Nomad don't look as good in my opinion but GM needs to build them. The Kappa platform exists because of Bob Lutz. Just maybe Lutz can get the suits to have even more martini's and sneak the rest of the Kappa concepts into production, including the Solstice coupe.
 

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Originally posted by darkangel@Feb 10 2004, 05:52 PM
gm is nuts the soltice is going to exceed 100,000 units because everyone wants one i have four friends in business waiting. Man they better sell all they can and make money off this car before Toyota catches up. This is the car that everyone wants and make the money count on this G.M. Get ahead on this one dont make another mistake.
you know it sounds like they are turning this from a peoples car, to a dealers car, if they only sell 20k they will have far less supply than demand. and in the car industry (and every other industry) this causes the price to clime. they are going to get above normal profiet for this car, and taht is sad, i can see them charging 24k for this car, instead of the 19,500 they should be doing, dealers are going to use this as a fat crop, instead of use it to get people to get there asses to pontiac.
 

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Originally posted by Canuck@Feb 10 2004, 06:07 PM
The Kappa line is capable of putting GM into the small car market in a huge way. Why put production limits on an affordable car?
i wonder this too. is it worth limiting production of such a low-cost car to keep it's cache? it's not like the GTO... the solstice is going to be within reach of MANY people. are there other reasons for limiting the number of solstices (solstii?!?)?

also, will the solstice loose any of it's oomph (i mean shock value) since we won't see it for another year and a half? will it be passé by fall 2005? i sure hope not. actually, any thoughts on why the wait is so long? wasn't it being taken serious by GM around the same time as the G6 concept?
 

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Limiting production is smart. The demand for 2 seat cars is historically small. The Solitice will be hot for a year or two, then the next big thing will come along to capture everyone's attention. Limiting production will keep resell values up and truly help the Pontiac brand. Does anyone think the PT Cruiser helped Chrysler's image once they flooded the market with the things?

If GM can figure a profitable way to sell 20K of these things a years, that's great news for us, because it will mean GM has figured out how to make more niche vehicles in the future. That means a Nomad and other cool niche vehicles are possible.

Mark

Edit: fixed a typo
 

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One thing to remember - some of the manufacturing processes the Solstice will use don't scale up very well. If memory serves, the body panels will be formed using a process that is cost-efficient at smaller volumes, but wouldn't be if they were cranking out way more than 20,000 cars a year.

Lutz has said GM can make the car profitably at 20000 units per year. I've seen other sources saying GM can make as many as 100,000 Kappa platform cars a year. I'd suspect the additional units would come from cars other than the Solstice, giving other divisions a smaller, sporty RWD specialty car to bring in dealer traffic.
 

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Discussion Starter · #15 ·
Originally posted by darkangel@Feb 10 2004, 12:52 PM
gm is nuts the soltice is going to exceed 100,000 units because everyone wants one i have four friends in business waiting. Man they better sell all they can and make money off this car before Toyota catches up. This is the car that everyone wants and make the money count on this G.M. Get ahead on this one dont make another mistake.
I would buy a base one too, but I already have a paid for second car - also a Pontiac convertible with a 4-banger. Yep, an early 90's Sunbird.
 

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after all they're going to base the f-bod on this platform or zeta?

so they're going to make the little saturn there too?
 

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you know it sounds like they are turning this from a peoples car, to a dealers car, if they only sell 20k they will have far less supply than demand. and in the car industry (and every other industry) this causes the price to clime. they are going to get above normal profiet for this car, and taht is sad, i can see them charging 24k for this car, instead of the 19,500 they should be doing, dealers are going to use this as a fat crop, instead of use it to get people to get there asses to pontiac.
You guys want GM cars that sell without incentives and yet you guys also want deals.

A 20,000 unit affordable halo car is brilliant, even if it sells for 25G instead of 20G. When it came out, a 14G Miata sold for 20G, and the dealers that -didn't- mark them up simply sold them to scalpers, who then turned around and sold them again.

Dealers' cars help the dealers in a big way. Customers looking for a "deal" have plenty of Tahoes, Suburbans, and Silverados that they can get. Every other company gets "Dealers' cars," why can't GM?

Ghrankenstein
 

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A. The Kappa platform is a stroke of brilliance from GM. B. It is not in anyway a given that the greedy, lazy, GM suites will not screw this up. C. Trying to limit the platform so they can screw every dollar out of people for every car would be the norm but BOYS AND GIRLS. SCREW THEM! If GM wants to pull this bleep on you give up the ghost and for 26 grand you can in 2005 get a 300+hp RWD Mustang GT. This may be hard to swallow but it's time to play hardball with these PUNK suits at GM. Give us what we want or go bleep yourselves.
 

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Discussion Starter · #19 ·
Originally posted by Ghrankenstein@Feb 10 2004, 04:52 PM
You guys want GM cars that sell without incentives and yet you guys also want deals. 

Dealers' cars help the dealers in a big way.  Customers looking for a "deal" have plenty of Tahoes, Suburbans, and Silverados that they can get.  Every other company gets "Dealers' cars," why can't GM?

Ghrank, your take from the Dealer's POV makes sense :D , but I have to partially agree with the angry dudes here.

Bob Lutz can't go through all the trouble and public effort to make a 20K car to meet the price point just so dealers can add 5 thousand to that. I mean, that was a big deal, and I was telling my friends about that price and they were really interested....FINALLY and affordable techy 4-cyl. coupe with an manual tranny and handling worth a darn from GM and its a convertible!

The guy above didn't want incentives, he wanted MSRP --- and who buys for MSRP anymore anyway? Dealers should do cartwheels over MSRP. :)

I guess I agree with the dealers taking profits for the first few months or so (heck, I would), but not the first YEAR. Coupes have a tendency to lose their appeal after a couple of years - the Solstice shouldn't be shackled by inflated prices....by the time the intended target audience can afford them, some other automaker will have its own similar product available, and oops, GM just lost its edge, and oh that Solstice is "so last year, man". Not to mention no word of a Pontiac Pursuit coupe with a similar setup for those who can't get their hands on a Solstice.

On the other hand, who can really say for sure if 20,000 cars a year is "too little"? This is not the perfect "daily driver", and isn't very practical. 20,000 may actually be the right target after all.
 

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Don't forget that the total of 20,000 was also due to the SLOW process to be used in forming the body panels... this isn't stamping folks! the shape of the Solstice couldn't be accomplished using traditional means, so they opted for this option, which in low numbers is cheap, but increases in cost over 20-30k production numbers, more machines/dies would be required, and would increase manufacturing costs a lot.
 
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