United Auto Workers at General Motors' plant in Lordstown, Ohio joined hands for a prayer vigil Thursday afternoon in front of the plant. Drive it Home Ohio, Detroit Free Press
The GM plant in Lordstown, Ohio, is targeted to be idled in 2019, as part of a GM restructuring. A banner depicting the Chevrolet Cruze model vehicle is displayed at the Lordstown plant on Nov. 27, 2018.(Photo: John Minchillo, AP)
It was late May when U.S. Sen. Sherrod Brown picked up the phone to cold-call General Motors CEO Mary Barra.
Brown, Ohio's senior senator, was worried about the Lordstown plant, a 52-year-old factory that has produced compact cars from the Pontiac Firebird and Chevrolet Cavalier and to the Chevrolet Cruze while employing thousands in northeast Ohio's Mahoning Valley.
On April 13, GM announced that the company would cut second shift – eliminating 1,500 jobs and leaving the factory with just one shift, down from three just 16 months earlier.
Brown, a Democrat, penned a scathing letter, questioning how GM had spent its money from the GOP tax cut. Little response. So Brown picked up the phone without an appointment and called Barra. He couldn't get through.
When the two connected via phone three days later, Barra told Brown that retooling the factory, which was built for small cars, would be too expensive.
Please, just make a public statement that you're committed to Lordstown, Brown pushed during a June 5 meeting with Barra in Brown's Washington D.C. office. Barra was non-committal.
That was the last time Brown spoke with GM's CEO. Five months later, Barra announced GM would end production at five plants in the U.S. and Canada, eliminating passenger cars such as the Chevy Cruze and potentially wiping out thousands of jobs. The Lordstown factory alone employs 1,400 workers who will lose their jobs if the plant isn't repurposed.
The announcement shook the Mahoning Valley. The grim news harkened back to Sept. 19, 1977, when steel producer Youngstown Sheet and Tube laid off 5,000 workers in one day. It's known locally as "Black Monday."
Black Monday had come again.
And Ohio's leaders were shocked. Time and time again, top officials in Columbus and Washington D.C. had reached out to GM – concerned about the plant's dwindling workforce – to seek answers or offer help.
It's not like Ohio had not helped before. Over the years, the state had given GM millions in tax credits, job training grants and other incentives, including an $82 million tax package in 2008 that was among the largest in state history.
Gov. John Kasich had set up JobsOhio, Ohio's privately run workforce development arm fueled by money from state liquor sales, for this very purpose: to attract and retain business in the state.
Still, Ohio's Republican Sen. Rob Portman was left making repeated calls. What's happening? Will you commit to re-purposing the plant if Cruze sales dip? What can we do to help?
Ohio's requests were met with silence and stonewalling.>
GM's Lordstown Complex, in Ohio, manufactures the compact Chevrolet Cruze sedan. It's one of five North American factories set to be idled next year, GM said on Monday. (Photo: General Motors)
'We didn't have any warning'
Layoffs. A union consolidation. Lagging sales of the Cruze. A popular SUV being built in Mexico instead of the Midwest. Anyone watching the Lordstown factory closely could guess that all wasn't well.
In January 2017, GM suspended third shift at the Lordstown plant, eliminating 1,245 jobs. The reason: more people were buying SUVs and trucks than cars. For a factory that made the compact Cruze, that was a problem.
For a few months, all was quiet. Then, in April 2018, GM offered buyouts and early retirement: about 600 people took the offer, according to the Youngstown Vindicator. Weeks later, GM announced it would cut second shift at the Lordstown plant: another 1,500 jobs.
On the same day that those workers finished their final shift, GM announced it would build its new Chevrolet Blazer in Mexico. The cruel irony wasn't lost on the Ohio workers leaving with their pink slips, said Dave Green, president of United Auto Workers Local 1112.
Two weeks ago, the plant's union, along with state and local politicians, launched the grassroots Drive it Home campaign to push for more jobs at the plant. (The next day, GM's board approved the cost-savings plan behind closed doors.)
Union leaders were hopeful. This layoff, that cut or this change would save the plant. For a little pain now, they would keep the doors open. And surely GM would give them some warning.
Perhaps that's why after months of cuts and GM's leaders' hesitance to commit to the Lordstown plant's future, Monday's announcement still managed to shock everyone.
"We didn’t have any warning that this was going to happen at all," Green said.
State incentives weren't enough
For a key Mahoning Valley employer, couldn't the state have pitched in some money or a tax break? Something, anything to keep GM from idling the plant?
Under Democratic Gov. Ted Strickland, Ohio offered GM a massive incentive in 2008: 75 percent off its income taxes for up to 15 years. Worth up to $82 million, the tax package helped renovate the plant to make the Cruze.
At the time, gas prices were high, and consumers were looking for fuel-efficient vehicles.
The plant added 200 new jobs by 2010 and added more in the following years – until 2017. Jobs were cut that year so no tax breaks were doled out, according to the Ohio Development Services Agency.
To date, GM received $14.2 million in credits to apply to taxes for making jobs and $46.1 million for retaining jobs.
Under Kasich, GM received grants to purchase equipment and train employees.
Kasich's JobsOhio had been talking with GM about its plans for the facility since Lordstown went from three shifts to two.
Incentives were offered. Is there something we could do to lower your energy costs? To help you with the workforce? To expedite permitting to retool the plant?
“They appreciated it, but nothing really came from it,” Kasich said Wednesday. "We have JobsOhio. They’ll keep meeting with them and seeing what we can do."
As a private entity, JobsOhio does not make details and costs for its deals public until they are final and executed.
GM spokesman Pat Morrissey told The Enquirer that the company made its decision based on market conditions and customer preferences, which increasingly means crossovers, SUVs and trucks.
"Obviously this is a market dynamic Ohio officials could not control," Morrissey said.
Still, Ohio has some experience with convincing auto companies to stay.
In 2014, Fiat Chrysler threatened to move production of the Jeep Wrangler out of Toledo. Fiat Chrysler CEO Sergio Marchionne had told the Paris Auto Show he didn't think a new aluminum-body Wrangler could be built at the plant.
Local and state officials lobbied Marchionne over several months. They offered to buy land to grow the plant. Kasich had "a lot of calls" with the CEO.
"We ended up working it out, and there ended up being more jobs in Toledo than when we started," Kasich said.
Help on the way?
But Brown and Portman, along with their staffs, had been reaching out to GM for months, seeking answers and offering solutions.
In fact, Brown called Trump in late June, asking the president to help workers in the Mahoning Valley, who had overwhelmingly supported Trump's presidential bid.
But Trump didn't realize that a shift had been cut, Brown said.
Portman said he had talked with GM over the past several months and emphasized the company would save money under the new tax law by keeping operations in Lordstown instead of moving them to Mexico.
He said the company was “unwilling” to be specific with him about what’s next, but he hopes it will involve putting an electric car in the plant.
“Ohio and the federal government working together might be able to provide some incentives for a reinvestment in Lordstown again,” Portman said.
Both Brown and Portman say GM never brought up tariffs on steel and aluminum, imposed by Trump, in their discussions about the Lordstown plant.
On Wednesday, Brown spoke with Trump and sent him a copy of his bill to incentivize American auto sales with by offering a $3,500 discount on nearly 100 cars and trucks and fully taxing auto companies’ overseas profits.
Brown said Trump “said the right things” Wednesday night but needs to follow it up with action.
What about Ohio's other automakers?
If Ohio can't keep GM in Lordstown, are other auto jobs in jeopardy?
Maybe not. Many of Ohio's remaining factories mostly assemble trucks and SUVs – vehicles with higher profit margins. For example, Fiat Chrysler's Toledo plants make the Jeep Wrangler and Jeep Cherokee. Ford's Avon Lake factory west of Cleveland assembles trucks such as the F-650 and F-750 and E-series vans.
Ford's transmission plant in Sharonville actually hired workers earlier this year.
The only other Ohio plant quite so dependent on the car is Honda's Marysville plant, home of the Honda Accord since 1982.
Honda, which employs 15,000 people in Ohio, is the state's top manufacturer and largest auto employer. GM is eighth among manufacturing employers and third among auto employers behind Honda and Fiat Chrysler.
Accord sales are down this year despite awards and positive reviews for the vehicle – underscoring the American consumer's shift toward trucks and SUVs.
But Honda cut production in Marysville earlier this year rather than eliminating jobs to offset the sluggish sales. Honda leaders are proud that they've never had a layoff.
And the Marysville plant recently started production of the Honda CR-V.
"That’s part of our flexible manufacturing approach," Honda spokesman Chris Abbruzzese said.
Kasich, U.S. Rep. Tim Ryan and others spoke with GM's Barra Thursday. Governor-elect Mike DeWine has been talking with JobsOhio and Portman and plans to meet with GM in Detroit in January after he's sworn into office.
My statement on a conversation I had this morning with GM CEO Mary Barra. pic.twitter.com/B8Tf5xu4Tr— John Kasich (@JohnKasich) November 29, 2018
Ohio's leaders see a couple paths forward for the Lordstown plant: bring in another GM vehicle or repurpose the facility for another product from another company. The state did this when Fuyao Glass America started operations in the former GM plant near Dayton.
GM officials say they remain committed to manufacturing in Ohio. Many of the workers will have the option of working in another GM plant, spokesman Morrissey said.
Green, leader of the union, is hopeful state and federal leaders will work out a solution for Lordstown.
"We’re going to continue to have hope and press forward," Green said. "We want to keep building a great American product here in America."
That is if GM will pick up the phone.
Source : https://www.cincinnati.com/story/news/politics/2018/11/29/why-didnt-ohio-stop-general-motors-leaving-lordstown/2137873002/Terima Kasih for visit my website