Thursday, February 18, 2010

The Buffalo News, February 14, 2010, Sunday

The Buffalo News

February 14, 2010, Sunday

The Buffalo News

GM event stirs speculation of new engine
Expectations rise on gathering next week

By Jonathan D. Epstein

General Motors Co. will hold “an event” at its Town of Tonawanda engine plant this week, but a spokeswoman stopped short of confirming reports that the company will invest millions of dollars to build a new engine there.

Spokeswoman Nina Price said she could not say if Town of Tonawanda Supervisor Anthony F. Caruana and U. S. Rep. Louise Slaughter, D-Fairport, were correct Thursday night when they said the automaker will announce the new engine line Wednesday or Thursday.

But she did say the company understands the importance of any such development at the powertrain plant on River Road.

“Any new business to any GM plant is a good thing for the plant itself and the surrounding community,” she said.

“It’s important, not only for the plant, but also for whatever city a new product goes into — for the city, the workers, the suppliers, the organization,” Price said.

The Town of Tonawanda plant has a strong record of winning new business when GM is looking to build a new engine or increase production of an existing model.

Arthur Wheaton, director of Western New York labor and environmental programs for Cornell University’s School of Industrial and Labor Relations, said he has also heard reports of “an impending announcement” but said it would not be a new line but rather an update to the existing L850 line, “which is still a huge deal.”

He said the new product is “a great engine” that “gets good gas mileage and good power.”

“It would be great for the engine plant,” Wheaton said. “It will definitely help the folks that are there if it’s true. It would help either retain the existing work force or possibly bring people back from recall.”

However, new hires will not be making as much money or benefits as existing workers. Under the new labor contract approved in May, new employees are brought in at lower wages. The contract is designed to reduce costs and make the company more competitive in the future.

Slaughter said in a news release last week that GM will build the next-generation, fuel-efficient four-cylinder Ecotec engine in Tonawanda. She praised the company’s move as evidence of the competitiveness of the plant and said it “ensures it will have new work well into the future.”

The plant currently makes the L850 4-cylinder engine for the Chevrolet Cobalt and Malibu, as well as inline 4-cylinder and 5-cylinder engines for other GM models. The L850 was also used in certain Pontiac models before that brand was discontinued.

The plant employs 630 hourly and salaried workers, but also has less than 300 workers on indefinite layoff because of drops in production volume.

Both Price and Wheaton said that a big factor in any decision to bring a new product to Tonawanda would likely be the strong working relationship between the United Auto Workers local union and the plant’s management.

That labor-management relationship was even part of a case study for two international conferences, Wheaton said, adding that he would “not be surprised” if it resulted in the new product as well.