GM to Boost Investment at Volt Assembly Plant, Battery Factory

DETROIT (Detroit Free Press/MCT) -

General Motors on Tuesday confirmed it plans to invest a total of $449 million in its Detroit-Hamtramck assembly plant and Brownstown Township, Mich., battery factory, to expand its electric-vehicle production and make way for two unidentified new products.

The automaker said it will invest $384 million at Detroit-Hamtramck to ready the factory for the redesigned Chevrolet Volt and two new vehicles.

GM also said it will invest $65 million to expand lithium-ion battery production and next-generation battery manufacturing in Brownstown Township.

A source familiar with the company’s plans told the Detroit Free Press the investment will involve a second production shift and about 1,400 jobs.

“Today’s news will ensure that the next-generation Chevy Volt continues and solidifies that position of leadership,” said Gerald Johnson, GM’s vice president of North America manufacturing, at an Automotive Press Association luncheon. “We want our customers to benefit from our investments in technology and to keep coming back to General Motors for their purchases.”

At the Detroit-Hamtramck plant — which straddles the borders of the two cities — the automaker currently makes the Chevrolet Malibu, Chevrolet Impala, Cadillac ELR and Chevrolet Volt, as well as two foreign versions of these cars. GM has invested more than $1 billion in the plant since its Chapter 11 bankruptcy in 2009.

Detroit Mayor Mike Duggan said the automaker has not yet asked for any tax incentives to support the plant’s expansion.

“When you see GM putting the investment here in future products, it says they have confidence in the men and women building the cars in Detroit and they have confidence in this community,” Duggan said.

Johnson said the Brownstown investment is targeted “for next-generation lithium-ion battery production, as well as other future battery systems.”

The announcement comes as GM is in a competition with Silicon Valley electric vehicle maker Tesla Motors to produce an affordable pure electric car. Both companies have said they plan to deliver such a vehicle within three years.

Johnson said the next-generation Volt is targeted for 2016. He declined to say whether the new products would include a pure electric car.

GM employs 1,629 workers at the 3.6-million-square-foot Detroit-Hamtramck plant, including 1,436 represented by UAW Local 22. The automaker employs 100 workers represented by UAW Local 174 at the 406,000-square-foot Brownstown facility.

The decision to commit to a redesigned Chevrolet Volt, a semi-electric vehicle, reflects a faith in the next generation of a vehicle that has struggled in its first iteration.

Volt sales have stagnated despite a $5,000 price cut last year to about $35,000. Sales fell 15 percent in the first quarter to 3,606 units. Sales fell 2 percent for 2013, to 23,094, despite the price cut.

The current version of the Volt can travel 38 miles on a battery charge before a gasoline engine kicks in and continues powering the vehicle. GM has said a redesigned Volt would have better electric range.