Kansas City Facility to Assemble Mid-Size Cars : GM Plans New $750-Million Plant
In the first step of what is expected to become one of the largest new-product programs in the company’s history, General Motors announced Tuesday that it will spend $750 million to build a huge new assembly plant in Kansas City, Kan., that will produce a new line of intermediate-sized cars in time for the 1988 model year.
The 2.3-million-square-foot, highly automated plant is expected to employ about 4,000 workers in two shifts to produce the new mid-size car, now code-named the GM-10 model. Except for the Saturn project, GM’s highly publicized effort to build an American subcompact that will be cost-competitive with the Japanese, the $7-billion GM-10 project is likely to be GM’s most important new-product program in the late 1980s.
Unlike Saturn, GM-10 has attracted little attention outside the industry, but it still calls for a massive overhaul of GM’s passenger car lineup. In fact, GM officials believe that the potential sales volume for the new front-wheel-drive model is so large that the company currently plans to replace both its front-drive A-body intermediate models (Chevrolet Celebrity, Pontiac 6000, Buick Century and Oldsmobile Cutlass Ciera) and its older rear-wheel-drive G-body cars (Chevrolet Monte Carlo, Pontiac Grand Prix, Oldsmobile Cutlass Supreme and Buick Regal) with the GM-10, company officials say.
Retool as Many as 5 Plants
Besides building the new Kansas City plant, which will produce up to 270,000 cars per year, GM also plans to retool as many as four other assembly plants in the United States and one in Canada for GM-10 production in the late 1980s, according to union officials and industry trade journal reports. GM is expected to announce plans to renovate those plants--in Arlington, Tex.; Oklahoma City; Oshawa, Ontario, and Doraville and Lakewood, Ga.--over the next few months.
When the Kansas City plant opens, GM expects to close an older assembly plant adjacent to the site of the new facility. That plant, which builds the big rear-wheel-drive Buick LeSabre, Pontiac Parisienne and Chevrolet Impala and Caprice models, employs about 5,000 workers, most of whom will transfer to the new plant when it starts operations.
A GM spokesman said Tuesday that, if sales of its large rear-drive cars remain strong through the next few years, it might keep both plants open and hire thousands of new workers for the GM-10 facility. If the older plant is closed, GM said it will be able to avoid any major layoffs through retirements and attrition from the older plant’s work force.
GM said the new Kansas City facility will incorporate Japanese-style manufacturing techniques that could improve productivity.
Like Japanese auto plants, including the GM-Toyota joint-venture complex in Fremont, Calif., the Kansas City plant will have a stamping plant adjacent to the assembly operation to reduce the costs of handling parts, and GM will introduce a “paperless” shipping and receiving operation patterned after the Japanese “just-in-time” system.
Separately, GM officials said the company has delayed making a decision on where to build its Saturn assembly complex, which has become one of the most highly sought-after industrial projects in history.
When the company announced plans for the Saturn plant in January, it said it would announce a decision about the facility’s location about May 1. But GM has been surprised by the deluge of inquiries that it has received from dozens of states seeking to win the Saturn complex and its 6,000 jobs, and company officials now say it could take several more weeks or months for them to select a site.
