Auto Outlook: New life for former Saturn factory

By AL SWANSON, United Press International  |  Nov. 27, 2011 at 5:15 AM
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Tennessee Gov. Bill Haslam, both U.S. senators and United Auto Workers President Bob King were on hand last week when GM announced its plans for the Spring Hill assembly plant that once produced Saturns.

General Motors Co. announced it will invest $61 million to build the mid-sized Chevrolet Equinox SUV at the facility 30 miles south of Nashville, creating 685 jobs. GM plans to make the plant an ultra-flexible manufacturing facility and invest $183 million more to produce a mid-sized GM vehicle for 2015, adding 1,200 more jobs.

About 400 to 500 new workers would be paid entry-level wages of less than $15 an hour, about half of what journeymen UAW autoworkers earn. Hiring begins next month. The Detroit News said about 280 UAW workers who moved to Michigan for jobs two years ago are eligible to return to Spring Hill when the plant reopens in the second half of 2012.

"Collectively in the UAW, we made a decision to make the communities in America our No. 1 priority," The New York Times quoted King as telling workers at Spring Hill. "Most important to us was creating jobs for more Americans."

U.S. sales of the popular Canadian-made Equinox SUV, assembled at two Ontario plants, are up 45 percent this year, with 162,283 vehicles sold through October, AutoData Corp. said.

GM said flexible manufacturing would give it the ability to react in real-time to sales changes for specific models.

"This a big deal to us," Haslam said.

GM opened the Spring Hill plant in 1990 to make the then-new Saturn compact turning Tennessee into a southern automotive hub, the Shelbyville (Tenn.) Times-Gazette reported.

GM eventually shifted Saturn production from Spring Hill and began building other models there, but in 2009 factory operations shut down except for an engine facility as GM entered bankruptcy. GM dropped the Saturn, Hummer and Pontiac brands during its federally backed reorganization.

"Spring Hill has a history as one of GM's most innovative and flexible plants, Cathy Clegg, GM vice president of labor relations, said in a statement. "We're pleased that, working together with the UAW, we were able to build on that history and develop a plan to resume production at Spring Hill."

Don't pass the Passat

Volkswagen Group of America is looking to the remodeled VW Passat to lead the German automaker's resurgence in North America.

The new Passat, which is bigger and less pricey than the 2010 edition -- the last year the old model was imported for the U.S. market -- has been getting generally favorable reviews from the automotive press although some critics say the family sedan's Germanic character and taut road manners have been Americanized for more fuel efficient highway cruising.

Built by American workers at a new $1 billion, non-UAW plant in Chattanooga, Tenn., the Passat was named Motor Trend's 2012 Car of the Year at the Los Angeles International Auto Show.

The Passat is powered by a 170-hp, 2.5-liter, 5-cylinder gasoline engine made in Mexico. The base car starts at $20,000 and quickly escalates to nearly $30,000 for the upscale SEL -- still thousands less than the older model which is still available in Europe and elsewhere.

In this economy, it seems Americans are no longer willing to pay a premium for a German nameplate.

Options include a 280-hp, 3.6-liter, V6 gas engine and a high-efficiency TDI turbo diesel which averages 34.3 mpg (43 mpg highway/28 city) in mixed driving. The 2.5-liter gas engine powered Passat averages 26.5 mpg (31 highway/21 city).

"The well-equipped Passat is a breakthrough car for Volkswagen, as it has been designed to suit the North American market and is being built in a brand-new, state-of-the art assembly plant in Chattanooga, Tenn.," Motor Trend Editor-in-Chief Angus MacKenzie said. "It has one of the roomiest interiors in its class, a wide choice of powertrains and a well-tuned chassis."

Motor Trend called it "a terrific all-around family sedan."

The magazine's technical editor said by building an all-new factory in the U.S. south, Volkswagen has reduced the risk of currency fluctuations inflating the price -- something that drove up the sticker on previous Passats.

VW hopes to sell 400,000 vehicles in the United States in 2012 and more than double that to 1 million in North America by 2018 on the strength of the remodeled Jetta, Beetle and premium Audi vehicles. To accomplish that Volkswagen will have to boost its U.S. market share from current 3 or 4 percent to around the 12 percent it has globally and it may add Audi production in the United States, VW AG head Jonathan Browning told the Los Angeles Times in an interview.


Best 'Green Car"

While the Passat Turbo Diesel was a contender, the Honda Civic Natural Gas was named Green Car Journal's 2012 Green Car of the Year at the Los Angeles International Auto Show.

The magazine hailed the $26,000 natural gas-fueled Civic for having the cleanest running internal combustion engine as certified by the U.S. Environmental Protection Agency.

"The new (5th) generation Civic Natural Gas features greater fuel efficiency, a handsome and roomier design and tailpipe emission levels untouched by any other internal combustion production vehicle," Green Car Journal spokesman Ron Cogan said in a statement.

The other contenders were the larger Toyota Prius V hybrid, the Ford Focus Electric, and the plug-in electric 66-hp Mitsubishi i, which the EPA says can go 62 miles on a charge in combined highway-city driving and 98 miles between charges in the city.

Saab waits

Saab, the ailing Swedish automaker facing possible liquidation, put off a meeting with its unpaid suppliers last week as it waited for General Motors to reply to its latest proposal for continuing to license GM technology.

GM balked at approving Saab's sale to two Chinese investors because the U.S. firm provides parts and technology for several Saab models and built the 9-4X crossover vehicle for Saab at a plant in Mexico.

Saab had no comment after the Swedish Business Daily Dagens Industri reported a General Motors spokesman said Saab would have to do without GM's parts and technology if the Chinese firms take full ownership.

Saab is supposed to pay its 4,000 employees missed wages dating back to August this week, just-auto reported.

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