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May 15, 2007

GM closing Massena plant

Will cut 500 jobs by end of 2008

MASSENA (AP) -- General Motors will phase out work at its aging Powertrain plant in northern New York by the end of 2008, eliminating almost 500 jobs, the company announced Monday.

Changes in manufacturing technology made it necessary to idle the 48-year-old factory in Massena, which would be too costly to modernize, said Sharon Basel, GM's Powertrain communications manager.

"We are really moving in a new direction from a technology standpoint in the casting end of our business," Basel said.

"Newer, more efficient engines require higher strength material for cylinder head castings and block castings, and the lost-foam technology done here at Massena doesn't meet those requirements."

The company is switching to precision sand and semi-permanent mold-casting technologies, which yield a greater integrity in the casting and produce components better able to withstand stress, Basel said.

The closing affects 394 hourly workers and 94 salaried employees. Employees were notified Monday. Employees will be offered severance packages that will be determined mostly on an individual basis, she said.

Two product lines made at the plant will be phased out in the near future and the third by the end of 2008, although that period could change depending on market conditions, she said. The work will be moved to GM's other U.S. casting plants in Michigan, Indiana and Ohio, she said.

"This is a decision that has been developing over some time as we've been seeing what's going on, and as we look at the new engine programs coming on stream in the future," she said.

"In the end, as hard as you try to develop a business case, you just simply couldn't," Basel said.

Basel said GM understands the closing is a severe economic blow to the community.

"But it is also part of the larger GM North America turnaround plan where we are trying to structure GM in a way that it is competitive for the long haul, not just addressing what it takes to compete right now or for the next couple of years," she said.

U.S. Congressman John M. McHugh (R-Pierrepont Manor) said in a news release that he was "deeply disappointed" by the decision.

"It's a heartbreaking development for the workers and the entire community. I am especially frustrated by the way that GM went about this decision, rejecting input from government officials and showing little desire to work out a mutually beneficial solution."

He said he would "work with the community and union officials to devise the best strategy to move forward in a post-GM Massena."

GM Powertrain, the largest GM division, operates 38 factories and 11 engineering centers in 13 countries. It employs 78,000 people worldwide.

The Massena plant has had an up-and-down history of employment. When it first opened in 1959, there were 100 employees. It reached a high of nearly 1,600 in 1979, then dropped to about 125 in 1990 before the plant began the lost-foam casting process that gradually brought employment back up over 500.

Last week, U.S. Sen. Hillary Clinton and U.S. Rep. John McHugh wrote letters to GM urging the company to keep the plant open.

Massena Town Supervisor Gary Edwards said the closing will be felt across a wide section of northern New York.

"They say for every job we have at these plants, it creates another eight jobs. So I'd say the ripple effect would be felt by just about everybody from the car dealers to the people that work in the flower shops," Edwards told Watertown television station, WWTI.

A key to recovery will be retaining the 12 megawatts of cheap hydroelectricity currently allocated to the GM facility, Edwards said.

"That could be our only salvation on trying to bring something new back into the area," Edwards said. "The North Country is very resilient and if we all work together and work hard at it, we'll rebound from this and hopefully down the road we'll be better for it."

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