GM van output to drop in 1999 Balto. assembly plant to cut production 10%

declining sales noted

200 jobs could be affected

Auto industry

November 21, 1998|By Ted Shelsby | Ted Shelsby,SUN STAFF

General Motors Corp. plans to trim production at its Baltimore van assembly plant by 10 percent during the first quarter of 1999, a company spokesman said yesterday, affecting an undetermined number of workers.

Beginning in mid-March, the plant will build 45 Chevrolet Astro and GMC Safari vans per hour, down from the current production rate of 50 units per hour, according to Joseph Jacuzzi, a spokesman for GM's Truck Group in Pontiac, Mich. He attributed the slowdown to declining sales.

Jacuzzi said it is too soon to say how many workers will be affected. Charles R. Alfred, president of United Auto Workers Local 239, which represents the plant's 3,200 hourly workers, said as many as 200 could be affected. The number of layoffs could depend on retirements and attrition over the next 3 1/2 months, he said.

Workers were notified of the company's decision earlier this week.

The reduction in assembly line speed will be the second at the Broening Highway factory in a year. In June, the company cut the number of vans produced per hour from 53 to 50.

That cutback resulted in the layoff of 125 workers.

GM also has closed the plant several times this year to help bring output in line with sales demand. Production was halted for a week in February and again in May.

The Astro and Safari face fierce competition from sport utility vehicles, according to David E. Cole, director of the University of Michigan's Office for the Study of Automotive Transportation. Cole said that the vans also suffer from not having had a major redesign since they were introduced in 1984.

David Healy, an automotive analyst with Burnham Securities Inc., said that at the end of October GM had 11,400 passenger versions of the Astro van in stock. "That's a 58-day supply and that's about normal."

The problem, he said, is that the company has a 96-day supply of Astro panel vans; a 103-day supply of Safari passenger vans and a 90-day stock of Safari panel vans. "That's much higher than they would like," Healy said.

Sales of the Astro and Safari totaled 174,815 units last year, down 5.4 percent from the previous year, according to Automotive News.

Sales for the first 10 months of this year are lagging about 16 percent behind last year's pace.

Other companies in the metropolitan area that supply parts to the GM assembly plant, including Monarch Manufacturing Inc. in Belcamp and Marada Industries Inc., in Westminster, will also be affected by the plant's slowdown.

The production decline comes as state and city officials are lobbying GM to keep its 63-year-old van plant open.

The future of the plant, which economists say pumps more than $1 billion a year into the region's economy, has been in question for several years. GM has not decided where it will build a redesigned van.

Pub Date: 11/21/98

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