Beyond the General Motors' headlines we've already splashed across the page this week, news ranging from close to home to the other side of the world has been a mix of GM contending with setbacks, as well as that of hopeful new ground being tilled for the future.



Chevrolet Volt in China – early examples were sent over to create interest in a market where GM is on the rise. In other quarters, it is contending with it all – the good, the bad and the indifferent.

Since we do not want to let some of these stories go by unreported, we thought we’d assemble a news brief round-up of items relating to the recovering American automotive company.

A literal fire

Yesterday, workers for a Michigan factory that supplies GM with interior components were requested to stay home until further notice following a Wednesday evening fire that wrecked an estimated 40-percent of the plant.

No injuries were known to be reported at the facility located between Detroit and Lansing, although some employees were transported to warm shelter from the sub-freezing weather.

While shortages to GM assembly lines will have to be dealt with, unknown is the full effect the shutdown will have on GM’s automotive production. What is known is that it is affecting at least seven GM manufacturing plants – including the Detroit-Hamtranck plant which makes the Volt – and GM had to to shorten shifts and reschedule overtime at various plants yesterday.



Fire at GM supplier's Atreum Howell plant. (Photo by Alan Ward / Daily Press & Argus).

The Detroit Free Press reported the Atreum Howell plant belongs to supplier Magna International , the company to which Opel was almost sold in 2009. It is one of more than 200 facilities the Canadian conglomerate owns in 25 countries.

The plant also supplies Chrysler, Ford, Nissan and Mazda, and employs 460 workers.

Aside from the Volt, impacted GM plants also build the Chevrolet Tahoe, Suburban, Cruze, Silverado, and Impala, as well as the Buick Lucerne, Cadillac DTS, and GMC Sierra and Yukon.

Environmental cleanup plan

GM may be leading the way in environmentally sound transportation into the future, but the aftermath of its past manufacturing has left a mess too big to ignore.

More to the point, a $770 million environmental trust was approved in a New York federal court, contingent upon final approval for the cleaning up and sale of 89 GM properties in 14 states.

The Detroit Free Press reported yesterday that U.S. Bankruptcy Judge Robert Gerber was expected to approve the liquidation, and the U.S. Attorney’s Office is still discussing more claims with GM that may require more money from the now restructured and profitable company.



An empty lot at Buick City in Flint. (Photo by Ryan Garza / The Flint Journal)

The approval process was said to have been expedited by the U.S. government which still owns 33 percent of the new GM. Pressure to approve the plan also came from the governments of Canada and Ontario which reportedly contributed $9.5 billion toward its bailout.

Forty-seven of the sites are in Michigan alone, and include the remains of Buick City, the Pontiac Assembly plant, and others. Cities most affected are Detroit, Saginaw and Bay City.

Canadian class action suit

Coincidentally, the sum of $770 million appeared twice in one week in actions against GM.

The second instance occurred on Tuesday, when a Toronto judge approved a $770.6 million (CA$750) class action suit by about 200 disenfranchised dealers. The group allege their getting the axe as part of GM’s restructuring concealed a conflict of interest, and was a breach of contract.

The plaintiffs claim they were given insufficient disclosure during 2009 out-of-court dealings by General Motors of Canada Ltd. and Cassels Brock & Blackwell LLP.

The lead plaintiff is Trillium Motor World Ltd., and the ruling was handed down by the Ontario Superior Court.

Represented by Sotos LLP, the plaintiffs are hopeful Canadian law will support their case more successfully than similar attempts in the U.S. have been able to for American dealers.

Building on opportunity

General Motors this week is reporting it and its joint ventures in China set a new sales record of 184,498 vehicles for February.

A Chinese English-language paper nevertheless managed to spin the news as a decline because all-time-record January sales were even higher at 268,071.

Industry-wide, the Chinese publication did acknowledge car sales in China slowed this year after the capitalist/communist Peoples’ Republic decided to reinstate a 10-percent tax on small car sales while phasing out subsidies in rural areas for trade-ins.



In any event, GM says China represents a bright spot in its global diversification plans, and the company is trumping sales records and growth there.

GM invested early in the decade in China, and that once controversial move is now largely being seen as brilliant in hindsight.


Entry level Baojun 630. (Photo courtesy of GM)



As further commitment, last year GM created an entire new brand for buyers in China's second- and third-tier markets called “Treasured Horse” – as Baojun is translated.

GM also says that China will be one of the first countries to get the Chevy Volt, although Buick is a more prestigious brand.

More precisely, February Buick sales increased 45.9 percent to 40,250 units, and several models set new records.

Chevrolet rose 5.7 percent by selling 42,358 units, and the Cruze set a new record, being the Bowtie brand’s leading Chinese model.

Cadillac surged 121.1 percent, selling a comparatively few 1,992 units to China's growing upper class, which preferred the SRX model as most popular.

Baojun logo.

The bulk of GM's Chinese sales remain the province of its subsidiaries, and especially in the mini-vehicle category. Of these, SAIC-GM-Wuling pumped out sales of 101,133, and FAW-GM sold 5,079 light commercial vehicles.

February sales in Shanghai alone were 78,207 units, 42 percent of the total for the country, and a 34.4-percent year-over-year increase.

Note that February sales in the U.S. were record setting too, but its sales across four much better-established brands of 207,028 units was only 22,530 units more than was achieved by GM's mere foothold in China.