Truck line may be for sale
International may buy GMs medium-duties
FLINT General Motors is considering selling its medium-duty truck line, which employs about 500 people at the Flint Truck Assembly Plant, but there is no firm deal yet, sources said.
And right now, the UAW, wrapped in thorny national contract negotiations with GM and Delphi Corp., doesnt see a good reason to approve any such move.
We are aware of these ongoing talks between the parties, said Cal Rapson of Clayton Township, vice president of the UAWs GM and Delphi departments.
While nothing formal has been presented to the UAW yet, at this time, we see no reason to approve it, said Rapson, who declined to comment further.
To keep the peace with the UAW, it is expected that GM would at least seek informal approval for changes to the medium-duty line. About 480 workers represented by UAW Local 598 are at Flint Truck.
According to parties familiar with the discussions, GM has been in an on-again, off-again discussion with International Truck and Engine to sell the medium duty line and eventually move it to an International facility in the Midwest.
International employees have been in the Flint facility, plant workers said. GM and International spokesmen declined to comment on any aspect of a potential sale or the negotiations.
We are not going to comment on or speculate about rumors that are out there. Thats pretty much all I can say at this time, GM spokesman Tom Wickham said.
Roy Wiley, a spokesman for Navistar, the holding company that includes International, also said he would not comment.
I just dont comment on rumors or speculation, Wiley said. Thats not a denial. I just dont comment on rumors or speculation.
International has its own medium-duty truck facility in Springfield, Ohio, where about 800 workers are represented by the UAW, Wiley said.
International has about 17,500 workers worldwide, and most of its manufacturing facilities are in the U.S., he said.
If GM sells the mediumduty line, the UAW workers who build the trucks likely would be absorbed into the plants other production line, which builds heavy-duty crew-cab pickups, sources said. That could free up space for a new, unspecified product at the Van Slyke Road plant, some sources said.
While the Flint Truck plants main products are highly profitable heavy-duty, crew-cab versions of Chevrolet Silverado and GMC Sierra pickups, a separate line in the plant builds medium-duty commercial trucks badged as Chevrolet Kodiaks, GMC TopKicks and even Isuzu TSeries.
The plant is GMs sole source for both products. GMC- and Chevrolet-branded medium-duties are expected to continue to be available even if a deal is reached with International and the UAW, and they are built by International, sources said.
Because International workers are represented by the UAW, a shift in the production site still would mean employment for UAW members, parties familiar with the talks said.
But UAW insiders said the union has had some prickly relations with International in recent months, and that might make a deal more difficult to reach. The UAW also has been having issues with GM and Delphi, attempting to settle up with Delphi on the future of well-paid union members as the parts maker prepares to emerge from Chapter 11 bankruptcy protection.
David Cole at the Center for Automotive Research in Ann Arbor, said he has not heard about the potential sale, but it might make sense for both companies.
I think when you look at what GM is trying to do, they are trying to focus on light vehicles, Cole said. Getting out of mediumduty commercial vehicles would free up focus and money for cars, pickups and sport-utilities for GM and would allow International to scale up its presence in the medium-duty market, he said.
If GM could get a reasonable price for selling the medium-duty line, it could be a good deal for GM, he said. Its not a mainstream product, Cole said.
International Truck and Engine Corp. formerly known as International Harvester is a leading producer of mid-range diesel engines, medium trucks, heavy trucks, severe service vehicles, and parts and service sold under the International brand.
GMs medium-duties, which come in a wide variety of powertrain, chassis and cab designs, are practically custom-built at the Flint plant.
Many leave the plant fairly stripped down and go to area upfitters such as Monroe Truck near Bishop Airport or Knapheide on the citys east side which add such specialty equipment as school bus bodies, refrigerator units, wrecker equipment or even recreational vehicle amenities.
Thus, any change in medium-duty production in Flint could ripple into the upfitters. Mark Hawkins, UAW Local 598 shop chairman at Flint Truck, said workers are nervous about the rumors because they are getting mixed messages about the status of the potential sale.
Ive been concerned since last June 2, when they took the second shift off, which is 11 months ago, Hawkins said.
Thats because the medium-duties have been a lowvolume product with a thin profit margin. To make real money and secure a solid future, they must be a higher-volume product, he said.
He said workers now are on a maximum overtime shift, pumping out a big order for U-Haul.
But the soft U.S. economy has hurt medium-duty orders for some time, he said, and production rises and falls with big orders.
Everything we do in the commercial business is based on the economy, Hawkins said. The economy in the commercial end of the business is always a factor.
We just expect that everyone continues to build a quality product to satisfy our customer, like we have been doing, Hawkins said, noting the trucks have won J.D. Power quality awards.
The issue has nothing to do with effort, with quality. Our workforce is top-notch. Its all about whether GM decides to be in that business or not.
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