GM’s $2.2 Billion Investment in Electric Pick-Ups to Bring 2,200 Jobs to Detroit

Updated: 2020-01-30 19:10:16

General Motors (GM) has announced it is investing $2.2 billion in its Detroit-Hamtramck assembly facility while devoting the entire plant to electric trucks and self-driving vehicles, creating some 2,200 jobs in the process. GM’s first all-electric pick-up truck will be built there, the company said, and production is scheduled to begin in late 2021.

According to a statement released this week, the battery-electric pick-up will be followed by the Cruise Origin, a self-driving shuttle intended for ride-share platforms that is currently undergoing testing in San Francisco. The autonomous vehicle is designed to combat urban congestion and air pollution issues, while reducing accidents as self-driving technologies mature, GM says.

Detroit-Hamtramck currently operates with one production shift and builds the Cadillac CT6 and the Chevrolet Impala, with approximately 900 people employed at the plant. The factory will be idled for several months beginning at the end of February as renovations begin. A further $800 million will be spent on equipment for component suppliers and related projects.

“Through this investment, GM is taking a big step forward in making our vision of an all-electric future a reality,” said GM president Mark Reuss during a press event at the plant with Michigan Gov. Gretchen Whitmer and other local and state officials. “Our electric pickup will be the first of multiple electric truck variants we will build at Detroit-Hamtramck over the next few years.”

Reuss also stated that the plant would have the capability of producing multiple brands and multiple styles, including electric pick-ups, SUVs and the Cruise Origin, which will not be made available to the public initially but will feature in GM ride-share projects.

Epoch Times Photo
General Motors President Mark Reuss announces a $2.2 billion investment at its Detroit- Hamtramck (MI) assembly plant to produce a variety of all-electric trucks and SUVs. (Photo by Steve Fecht for General Motors)

In November 2018, General Motors had announced that the company planned to close the Detroit-Hamtramck facility—one of four it had planned to shutter across the U.S. However, GM promised to reopen the factory in the course of its negotiations with the United Auto Workers (UAW) union in late 2019.

According to a statement from UAW vice president Terry Dittes, “General Motors announcement of new electric truck production at Hamtramck maintaining 2,200 UAW jobs, is a testament to the perseverance of our UAW members and UAW Region 1 under the direction of Frank Stuglin. Over 2,200 jobs and a new technology product will deliver job security and a bright economic future for UAW members for decades to come at Hamtramck.”

On December 5, GM had announced that it would be teaming up with Korea’s LG Chem to invest $2.3 billion in development and a battery cell factory in Lordstown, about 60 miles southeast of Cleveland, Ohio, creating 1,100 jobs in the process. According to GM, the greenfield, state-of-the-art 50:50 joint venture will help the company to benefit from economies of scale and bring down the cost of electric vehicles (EVs) for consumers.

State support

On January 22, the Michigan Strategic Fund (MSF) stated that it had approved amendments to the Global Retention MEGA tax credit agreement with General Motors that would “foster the company’s continued investment in Michigan and ensure the state’s position as the global leader in automotive design, manufacturing and future mobility.” The amendments were designed to enable the company to have more flexibility to manage its operations within Michigan, and to lock in GM’s commitment to developing and constructing electric vehicles and future mobility solutions in Michigan for the long term.

To support the company’s commitments, the Michigan Strategic Fund had required GM to invest at least $3.5 billion in Michigan over the next 10 years, including an investment at the Detroit Hamtramck facility. The MSF also approved a downward revision of GM’s MEGA tax credits by $325 to a remaining value of $2.27 billion. The company agreed to increase the average weekly wage from $650 to $1,300 statewide for the remaining credit term, while changing job retention rules across the state to allow more flexibility for GM to allocate more jobs to its Detroit headquarters. GM must also retain at minimum of 34,750 jobs in Michigan, though it currently employs around 45,000.

The 2,200 jobs promised for Detroit-Hamtramck should prove a welcome boost for Michigan: The Center for Automotive Research estimates that every job in an automotive assembly plant has a multiplier of eight jobs throughout the supply chain.

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