Plant’s Future Unclear as GM Weighs Selling Redesigned Cars

The future of General Motors Corp.’s assembly plant in Van Nuys, Southern California’s last remaining auto factory, looks as clouded as ever.

The plant is GM’s sole builder of the Chevrolet Camaro and its sister sports car, the Pontiac Firebird. The cars’ designs have changed little in the past several years and their sales have steadily declined over the same period.

GM is designing new plastic-bodied versions of the cars, which would probably go on sale in the early 1990s, to boost their popularity. But GM has made no guarantee on whether Van Nuys will get to build the cars, assuming that the new models are even approved for production.

And that’s a big if. Last week, Lloyd Reuss, GM executive vice president in charge of North American automotive operations, acknowledged that the new designs are making little headway in part because GM is concerned that tougher fuel-economy standards and emission-control regulations might make it tough to sell the Camaro and Firebird.

In an interview published last week in the trade journal Automotive News, Reuss also said plans to build a new generation of the cars might simply be scrapped. That would leave the Van Nuys plant with nothing to build.

The journal also quoted company insiders as saying that the people in charge of the Camaro and Firebird, known as the “F-cars” at GM, have yet to build a strong case that new versions would significantly increase their sales.

Even if GM eventually decides to produce new versions, it likely would be three to four years after that before production would actually begin. Which begs the question: Would GM be willing to keep building the slumping Camaros and Firebirds in Van Nuys until 1993 or 1994?

‘Don’t Have Any Change’

“That’s a question that’s very difficult to answer,” said Darwin E. Allen, a GM spokesman in Warren, Mich. “At this stage of the game, Van Nuys is building the Camaro and Firebird, and we don’t have any change in that.”

All this comes as no surprise to the United Auto Workers, whose Local 645 represents the plant’s 3,500 hourly workers.

Bruce Lee, UAW’s Western regional director in Los Angeles, said he has known for at least eight months that GM was thinking of letting the Camaro and Firebird disappear. That is why the UAW has been trying to persuade GM to shift production of other models to Van Nuys so the plant is not dependent on the Camaro and Firebird.

“We’ve been pushing for the Van Nuys plant to be a flex plant”--one that could build two or three different models, he said.

Specifically, the union has urged GM to build a van or small truck in Van Nuys because those products are big sellers in California. Conversely, most Camaros and Firebirds are sold east of the Rockies.

Automotive News also said GM planners have been studying the idea of building the Camaro and Firebird at a plant that also produces other models because sales projections of the sports cars might not warrant having a plant solely for them.

Excess Production Capability

If that happened, Van Nuys might keep building the sports cars and some other models under its flex proposal. But GM might also abandon Van Nuys and move the Camaro and Firebird elsewhere because, according to industry analysts, GM has lots of excess production capacity.

Sales for the F-cars peaked in 1978, when GM sold 281,733 Camaros and 195,377 Firebirds, according to Ward’s Automotive Report, another industry publication. Now sales total less than half that, with 101,665 Camaros and 59,493 Firebirds sold in 1988.

Through July, sales of Camaros and Firebirds were up 13% and 4%, respectively. But Al Binder, Ward’s managing editor, said the gains reflected heavily promoted financial incentives by GM rather than a resurgence in the cars’ popularity.

Lee said the UAW’s plan that GM build different types of vehicles in Van Nuys is “getting a very favorable reaction” but is still “working its way through that horrendous bureaucratic system that GM has.”

Allen declined to comment on how GM is responding to the union’s proposals.

Van Nuys plant officials, including Manager Robert Stramy, are declining all interview requests because the plant is resuming production following a five-week shutdown that ended Aug. 7.

The shutdown was to retool for the 1990 models and, when production resumed, the plant cut its daily output 23%, to 48 cars per hour, because of slow sales. The cutback forced GM to indefinitely lay off about 400 workers.

When will GM decide what to do with the Van Nuys plant, a 101-acre property with 2.5 million square feet of assembly floor? GM previously said it would make an announcement in this year’s fourth quarter, although Allen indicated that it might be pushed back because the redesign is making such slow progress.

Lee said he has “no idea when they’re going to make a decision. I don’t think they know themselves.”