Press conference this morning: Janesville GM plant to close by end of 2009 (Last day of full production 12/23/2008)

[Invader3K]

Just announced by GM at their press conference in Delaware. Seems like the writing had been on the wall for some time. As someone who doesn't live far from Janesville and has a friend who works there, this is a pretty big deal.

[PeaveyFury]

Holy moly, GM practically IS the Janesville economy.

[Teatoe993]

Too many brands, too many models, too many plants, too many dealers. Closing some of the SUV plants is common sense if GM ever wants to be profitable again. Let alone survive as a company.

[JimH5]

Very sad news for Janesville, and hope that those affected will be able to find work nearby.

[Chio151]

I know people who work at that plant, that community is going to suffer big time.

[DuWayne Steurer]

Living in Janesville, I can say that this is about all people were/are talking about. Things are going to be tough here for a good long while I think. Gilman announced that they're moving, that's 160 jobs lost. Allied, Lear, and I'm sure a few other of GM's "satellite" companies have or are going to be laying off or shutting down as well. There could potentially be 3-4,000 unemployed due to this, not to mention the hit to the local economy.

 

The city will survive, but this is a huge blow. It's hard to find a family that's been in Janesville for 10 or more years that isn't directly tied to GM in some way. This will affect just about everybody in some way.

[FVBrewerFan]

Too many brands, too many models, too many plants, too many dealers.

Too many unions (one), too many pensions, too many benefits. That's the problem. Like it or not, GM competes in the world economy. It is a sad day for Janesville, but shouldn't be a surprise.

[fondybrewfan]

It is kind of ironic that all these people are losing their jobs because their union isn't allowing the company to compete. It is really sad. The auto industry is the poster boy industry for the anti-union group. You could argue pretty effectively that the autoworkers union has single handedly brought down the American auto industry. These company's just have some much overhead due to all the extra benefits and pensions that is no wonder they are financiallt struggling. Of course gas prices certainly aren't helping out matters either. But overseas company's are not struggling anywhere near what Ford and GM are. Detroit is the forecolsure capital of the USA right now because so many people are losing their jobs.

[Roscoe Chill]

Holy moly, GM practically IS the Janesville economy.

 

Maybe when they had 7,500 employees in a town of 50,000. But now they're only at 2,400 employees and they already knew that at least 750 more were being laid off before this morning's announcement. And now Janesville is pushing 70,000 people.

 

Don't get me wrong, it's definitely a big blow, and still very important to the city, it's just not going to make it another Flint, MI like I keep hearing people say.

[Invader3K]

Well, I think the city of Janesville saw that this might happen a while ago, and seems like it's taken some steps to diversify the local economy a bit, and bring in new businesses. Yes, it will hurt the city for a while, but they will go on. I don't think it will end up being like a Rockford or something. Not to get all political, but I do think the union there killed the golden goose, to a degree. I've heard plenty of stories of how employees were able to get away with being incompetent, no-showing, etc. A modern business can't work like that and expect to be successful.

[Nottso]

It's the union's fault? You guys need to get a grip on reality. It's the fault of the American consumer. If everyone that bought a foreign pickup/suv had bought a GM product instead, that plant would be expanding rather than closing. And before you cry "quality" you need to take a good look at a JD Power report and/or other independent research; American vehicles are among the highest quality out there. It is no longer the 1970's.

I'm also hoping one of you guys can explain this to me: Big business cries "the unions are why prices are so high" and you people eat it up as gospel. Then, the Japanese build (non union) plants down South and pay the workers much less money and provide far lesser benefits. Yet, those vehicles cost as much (if not more) than their union built American counterparts. How exactly does that work?

[Nottso]

If people would quit buyin' Jap cars, the big 3 wouldn't BE in trouble. Nor would their suppliers.... support personnel.... truck drivers.... etc, etc,etc, on and on and on.

Let us suppose for a minute that we, the American people, actually supported American workers and bought only American products. Hell, let's just simplify and stay on vehicles. If everybody that bought a Jap truck bought an American truck instead, do you think the Janesville plant would close and wither away? Not likely. More Americans would have jobs making more money with better benefits. Most of the money would stay here as opposed to going across the water. Where's the down side? There isn't one. We'd just have to quit making excuses and do what we know is right.

We've become a "me first" society, saving our precious 17 cents at Walmart until we've completely destroyed our manufacturing base; and thus, our entire economy. The very first rule of economics is: "There is no money until someone makes and sells something." Think about that. No need for accountants, investment bankers, financial managers, etc, until someone earns some money by making and selling something.

How important is manufacturing to defense? Ask Robert E. Lee. Had the North not had all the manufacturing, the South would clearly have won The Civil War. The Southern boys were better shots, better outdoorsmen in general, and the Southern generals were much better strategists. What happens in the next war, when we don't have anywhere to make planes and bombs, and everything else? Maybe we'll get lucky, and whomever we're at war with will sell us what we need to fight them. Yeah, right.

Now let's talk "profit margins."

In the old days, every little town in America had "Johnson's Hardware" on the town square. Mr. Johnson employed Mr. Smith and paid him a wage that allowed Smith to own a home and raise a family. Little Billy Jensen delivered packages after school and was learning the hardware business. Mr. Johnson made a good deal more money than Smith, as he should, but he wasn't a greedy pig.

Today, all the Mr. Johnsons have been run out of business by "Mr. Home Depot" and all the Smiths no longer have jobs, because Mr. Home Depot hires minmum-wage know-nothing dolts to work in his store, and sells cut-rate Chinese junk as opposed to well-built American products. Little Billy Jensen is working at McDonald's, at the age of 34. Mr. Home Depot has a great profit margin. The guys at the top are making a killing. Fie on everybody else.

Across the square from Johnson's Hardware was "Joe's Auto Parts." Auto Zone got him. Same way. Same story. Cheap junk, idiots behind the counter. Joe and all his decently paid employess are screwed. Great profit margin, though.

Just off the square was "Town Grocery." WalMart Super Center came in. You know the drill. Great profit margin for the Walton family; must be good business.

And we are one step closer to becoming a "society of the super-rich, and the drones that serve them."

[PeaveyFury]

Don't get me wrong, it's definitely a big blow, and still very important to the city, it's just not going to make it another Flint, MI like I keep hearing people say.

 

No, it's not going to be another Flint situation or anything like that, but as RoCo said, it's about more than the 2,600 employees- all the satellite companies leave as well, plus the potential impact to the restaurants/stores/etc in the area as a trickle-down is almost a sure thing.

[craigharmann]

I grew up in Janesville, and I remember touring the plant when I was little and we had members of our church that worked there. It's sad to hear. Not surprising, considering the economy and the times we are living in, but it's still sad.

[Nottso]

I'm sure we've all seen the commercials. They tell us this new full-sized Toyota Tundra 4X4 is the biggest, baddest, toughest, strongest pickup truck ever dreamed up by mere mortals. Well, this is what it looks like when one of 'em is parked between a couple of Fords....

http://groups.msn.com/isapi/fetch.dll?action=MyPhotos_GetMBPhoto&ImageID=nHQAAAOgHZW1G0yfa2rtnelKAq2SfsNbBYJUaedtSEub0ems4f815YwwrxXif972Z

The filthy one on the left (as you look at it) is my personal 2002 F150 that is bone stock from the factory. The other one is an Expedition (Ford's midsized SUV) that also appears to be stock. I'd sure like to get that fine Japanese vehicle out in the mud or the snow to play with my Ford. Somehow, I don't think it would quite live up to the commercials.

My apologies for the crappy picture. This happened purely by accident when out shopping with the wife, and I grabbed the pic with my cell phone.

[Patrick425]

Nottso, obviously you have strong feeling about this and I have a feeling the moderators are starting to get a little nervous about where this thread is going, but isn't everything you described pretty much the definition of capitalism? Here is a link to consumer reports top cars in each category. Every car on the top of the lists (except pick ups) are foriegn cars:

 

http://www.consumerreports.org/cro/cars/new-cars/news/2007/04/top-picks-for-2007-4-07/overview/0704_top-picks-2007.htm

[PeaveyFury]

It's the fault of the American consumer. If everyone that bought a foreign pickup/suv had bought a GM product instead, that plant would be expanding rather than closing.

 

No, it's the fault of the company for not shifting it's ways to the market sentiment fast enough. They've had three years warning that oil prices would be skyrocketing and become an increasing burden on the wallets of their target buyers, but instead of shifting away from gas-guzzling SUV's, Tahoe's and the like, they let the foreign makers sweep into the market with cars of a high quality that get great gas mileage and last a really long time. As others said, this was necessary to get the company back on track, but they got themselves off track in the first place.

 

As I heard on the radio this morning, the American car makers are struggling like mad with sales and profitability, but the foreign makers are cruising right along- the consumers are buying cars, they're just not buying the ones that GM, Ford, and Chrysler thought/hoped/prayed they would.

[Teatoe993]

It's the union's fault? You guys need to get a grip on reality. It's the fault of the American consumer. If everyone that bought a foreign

pickup/suv had bought a GM product instead, that plant would be expanding rather than closing. And before you cry "quality" you need to take a good

look at a JD Power report and/or other independent research; American vehicles are among the highest quality out there. It is no longer the 1970's.

 

 

Why else would the American consumer buy a foreign vehicle if it wasn't for a better product? I don't know about you, but a good quality report from JD Power or Consumer Reports isn't gonna rush me to the nearest Chevy dealer. What matters most to me is the experience behind the wheel. It's something you see, feel and experience. For the past 35 years, Detroit has been engineering and building rather bland looking and driving vehicles. There are some exceptions, but the majority has been lackluster. Add to that the terrible build quality up until the past few years and you have multiple generations have never even had a domestic vehicle in their driveway ever.

Detroit isn't going down without a fight though. Finally there are some executives that understand what is going on and slowly we have been seeing some rather nice automobiles in production: Cadillac CTS, Chevy Malibu, the new Saturn lineup, Ford Edge, Ford Focus, etc. Although Chrysler is still pretty much hopeless. It's a long upward battle for them to get anywhere near the market share they had in the past. You are right it is no longer the 1970s.

 

I'm also hoping one of you guys can explain this to me: Big business cries "the unions are why prices are so high" and you people eat it up as

gospel. Then, the Japanese build (non union) plants down South and pay the workers much less money and provide far lesser benefits. Yet, those vehicles cost as

much (if not more) than their union built American counterparts. How exactly does that work?

 

 

Again it's all down to the product. The Japanese have the market cornered because they've built a reputation of building good quality automobiles. And they also know how to build them cheaper and more efficiently. They can price them in competition to domestic competition and usually price it a bit higher and know that they'll sell. Meanwhile, every Chevy dealer has to offer 0% financing or $5,000 cash back just to move the hundreds of Trailblazers they have sitting on the lot. And it's only the Joe Sixpack guys that go for this thing because they love the somethin' for nuthin deals. Do they not realize that there is a reason why the dealer is practically giving these things away?

[NeedMoreFans]

The problem I see is that American car makers keep thinking that people will come back to the large gas guzzlers, and the foreign makers are making smaller, more fuel efficient cars. The American companies can't sell them, and the foreign makers can't make them fast enough. I think foreign makers adapt to the needs of Americans better than American makers do.

[bork]

What matters most to me is the experience behind the wheel.

That's exactly it. I never thought I'd buy a foreign car, but after 12 years of non-stop problems with the crap that GM sells, I had enough. Switched to Honda 4 years ago, and haven't had a problem since. It will take a lot more than a few good reports, to ever get me to reconsider.

[Invader3K]

The problem I see is that American car makers keep thinking that people will come back to the large gas guzzlers, and the foreign makers are making smaller, more fuel efficient cars. The American companies can't sell them, and the foreign makers can't make them fast enough. I think foreign makers adapt to the needs of Americans better than American makers do.

Ditto. How long have companies like Toyota had hybrid vehicles they have been promoting, and people have been buying up, since they are getting tired of paying so much for gas? Meanwhile, some years ago, GM came out with the EV-1 to basically try and kill off the idea of an alternative vehicle. If you don't believe me, look it up.

 

Yeah, it's the fault of Americans for supporting "Japs." This is a global economy, and companies will have to adapt or suffer the consequences.

[Beerambassador]

I don't think it's fair to look at GM's collapse and cry "It's the union's fault!" The fish rots from the head down. You mean nobody at the top anticipated the rise of gas prices and the decline of the SUV? If GM would've been a bit more creative over the years at the top level, design, etc. they'd be competing just fine. Sure the union has been a hindrance, but I think laying the blame solely on the workers is just convenient for the anti-union crowd.

[Teatoe993]

Let's not give the union a free pass either. From the executive who okayed to put the Pontiac Aztek into production, to the forklift guy making $90,000 a year with full benefits and pension, this has been a joint effort for the past three decades to get to where they are now.

[Beerambassador]

I'm not giving the union a free pass. Like I said, it's been a hindrance - a big one - but people are relishing the fall of GM so they can damn the unions some more. It's like some people are taking glee in it (not referring to anyone here).

[Invader3K]

I'm definitely not blaming the union solely. The upper level management clearly did not anticipate changes in the market, and failed to adapt. A lot of people are going to pay for their mistakes. I just think there has to be give and take on both sides. Didn't the union anticipate that GM would have to make painful changes if things didn't change with pensions and other issues? Was it really for the best that the union played hardball with GM for so many years, now that the plant is closing? Again, I don't work there and haven't worked there, but I have heard enough stories from people who do and have worked there to question a lot of the on-site policies that were in place.