LORDSTOWN — Michelle Booth is among thousands of people hoping General Motors will make another vehicle at the Lordstown plant after production of the compact Chevrolet Cruze ends in just four months.
Booth, 50, is a United Auto Workers member who has been on the plant’s assembly line since 2000 and will be among 1,600 people put out of a job.
Booth said she well knows how important the plant is to the entire Mahoning Valley economy, not just to her fellow workers. The plant and workers are part of a complex regional ecosystem that keeps other businesses afloat, pays significant taxes and supports such things as the local United Way and other charitable causes.
“We’ve already gotten all of our politicians involved,” said Booth, who lives in the village of Mineral Ridge, which straddles Trumbull and Mahoning counties in Northeast Ohio.
“This is not a union issue. This is not a Democrat issue. This is a community issue,” said Aaron Johnstone, a UAW shop chairman for a plant unit that does facility maintenance and shopkeeping.
“If you live here, I promise it’s going to affect you,” said Johnstone, 33, who lives in nearby Niles.
Getting a new General Motors vehicle for the 52-year-old Lordstown plant, which sits on more than 900 acres, won’t be easy, the UAW workers and others in the community say.
But they are going to try.
Lordstown will be “unallocated” once Cruze production ends in March as part of a larger plan to reconfigure and refocus General Motors, the automaker said in a surprise announcement Monday. Some 14,000 jobs are expected to be lost nationwide. Other GM plants are also being “unallocated,” including outside the United States.
“Unallocated” does not necessarily mean permanently closed.
Still, getting GM to “re-allocate” Lordstown is going to take real effort, said politicians, union workers, private sector officials and others on what might work to keep the mammoth complex viable.
Tough road ahead
Cruze production, which started in 2008, is ending in 2019 because people increasingly prefer to buy crossover vehicles, SUVs and light trucks over economical compact cars. Cruze sales peaked in 2014 and then tumbled along with declining gasoline prices.
Lordstown workers saw the handwriting on the wall earlier this year when, on the same day, GM announced it was ending a second shift at the Ohio plant and would build the new Chevrolet Blazer SUV in Mexico, Johnstone said. The announcements did not sit well with the workers, he said.
Still, retooling Lordstown to make the new Blazer or a new technology vehicle would require significant work and expense, Johnstone said. One major roadblock is that the plant’s paint shop cannot accommodate bigger vehicles like the new SUV, he said.
A major retooling likely would cost hundreds of millions of dollars; GM said it spent more than $351 million at Lordstown to make the Cruze.
It would also take considerable time to make significant changes at Lordstown, Johnstone said.
“Our membership could be sitting out for some time waiting on that retooling,” he said. “But in the long run, it might pay off. And be better off. It’s hard to say. At this point, I don’t think anybody’s turning down anything.”
If General Motors announced it was bringing the Chevy Blazer to Lordstown, the company would still have to redo a lot of the processes inside the plant because the facility is set up for a small vehicle, Johnstone said.
Making something like electric or autonomous vehicles likely would require even more retooling, he said.
But the new technology vehicles that General Motors says it needs to increasingly emphasize may be best for Lordstown’s future and for the area, said James Dignan, president and chief executive officer of the Youngstown/Warren Regional Chamber.
Still, while there has been lots of talk about what to do with Lordstown, there have been no overtures from GM so far, he said.
Dignan noted the community launched the “Drive It Home” campaign to lobby for another vehicle for Lordstown shortly before GM stunned everyone with the Cruze announcement. Both Dignan and Johnstone said the Drive It Home campaign is going to continue.
Dignan said it appears General Motors expects to get about 75 percent of its revenue from three product lines: crossovers, SUVs and trucks.
So, maybe it makes sense to tie Lordstown to the remaining 25 percent, Dignan said, whether that involves electric or other new technology vehicles.
Basically, it means involving Lordstown where General Motors is doubling down, he said.
“That’s the market we want to get into,” Dignan said.
The next step
Northeast Ohio has the right businesses, knowledge and workforce to support whatever new automotive technology vehicle General Motors needs, Dignan said.
The region wants General Motors to be there for another 50 years, he said.
“There are opportunities here,” he said.
But if Lordstown doesn’t get another vehicle, the facility will need to be repurposed, he said.
Robert Schoenberger, editor of Today’s Motor Vehicles trade publication and former auto industry beat reporter for the Plain Dealer, said Lordstown will need to find the right vehicle to succeed.
“Lordstown is built for mass market, high volume,” he said. “It should be flexible enough to do new products.”
When you look at the current General Motors vehicle lineup, there are few vehicles that make a good fit for Lordstown, he said.
The new Chevrolet Blazer, which is designed to compete against the Ford Explorer and similar SUVS, could fill Lordstown but likely not without significant retooling expenses, he said.
“You could get a two-shift operation out of Lordstown” with Blazer production, Schoenberger said. But General Motors shareholders likely would not be happy with moving production from lower-cost Mexico to higher-cost Ohio, he said.
In ending production of the Cruze in the United States, General Motors is also betting that gasoline prices will stay low and that rising interest rates won’t change people’s buying habits, he said. If gas prices rise and interest rates make vehicle loans ever more expensive, that could make consumers more interested in smaller cars like the Cruze, he said.
Politicians can pressure General Motors to give Lordstown another vehicle, he said. For one, General Motors received a major federal bailout during the Great Recession and also has benefited by recent cuts in corporate tax rates.
That adds to the argument that GM “owes something to the American public,” Schoenberger said.
Susan Helper, an economist at Case Western Reserve University and former chief economist at the U.S. Department of Commerce, said GM’s announcement that it was ending Cruze production at Lordstown reflects a public policy failure. The federal government had opportunities to pressure GM to reinvest in its plants instead of spending billions of dollars on stock buybacks; the government also did not attach any strings to the new corporate tax cuts, she said.
GM essentially has said, “Yes, taxpayers, we’ll take your money and give it to shareholders,” she said.
The Trump administration’s decision to relax fuel mileage standards also is hurting small car sales, Helper said.
It is also possible that the plant closure announcements are in part a prelude to negotiations that are scheduled to start next year with the UAW, Helper said.
Pressure to prioritize
Arno Hill, mayor of the village of Lordstown, said he has been in touch with Ohio’s U.S. senators, congressional representatives and state politicians over the future of the plant. While the region has been successfully diversifying its economy in recent years, the GM factory has “carried the valley” for decades, he said.
“We have to figure out what General Motors needs,” Hill said.
He said GM hasn’t said it was permanently closing Lordstown.
“We have a pulse and a heartbeat,” Hill said. The mayor said if he were a betting man, he’d say Lordstown eventually will get another vehicle.
“I would say there’s a chance we’ll get another product,” he said. “I wouldn’t bet a lot on it.”
Ohio’s two U.S. senators, Republican Rob Portman and Democrat Sherrod Brown, have both said they will work to support a new vehicle at Lordstown.
Brown and President Trump got into a social media squabble over GM’s announcements. Brown announced he subsequently talked with the president and asked him to support his “American Cars, American Jobs Act.” Brown introduced the legislation after GM announced it was ending Lordstown’s second shift and was going to build the Blazer in Mexico. The legislation calls for giving Americans a $3,500 discount when they buy a made-in-America car and revoking a tax cut on overseas profits for automakers who shift jobs outside the United States.
U.S. Rep. Tim Ryan, D-Niles, meanwhile, said he spoke last week with GM’s chief executive officer, Mary Barra, about the upcoming closure. Lordstown is in his district.
“I told Mary Barra that I am focused on bringing a new product to GM Lordstown, and I will work with her and the Trump administration to get that done. This is my highest priority,” Ryan said in a news release. The congressman also called for “a cohesive national manufacturing policy” in a House floor speech Friday.
Gov. John Kasich also said he spoke with Barra last week about GM’s plans for Lordstown and that the automaker and JobsOhio will hold discussions on the future of the Lordstown plant. That future could include bringing in another vehicle or finding another purpose for the factory, he said.
Jim Mackinnon can be reached at 330-996-3544 or email@example.com. Follow him @JimMackinnonABJ on Twitter or www.facebook.com/JimMackinnonABJ