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VOL. 129 | NO. 167 | Wednesday, August 27, 2014

GM to Move Cadillac SRX Production to Tennessee

ERIK SCHELZIG & TOM KRISHER | Associated Press

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SPRING HILL, Tenn. (AP) – General Motors is moving production of the next-generation Cadillac SRX crossover SUV from Mexico to a factory in Spring Hill, Tennessee.

The company also announced Wednesday that it will add production of some small gasoline engines to the Spring Hill complex.

The additions will bring more jobs to Spring Hill, but a spokesman wouldn't give specifics on how many would be added to the sprawling former Saturn facility about 40 miles south of Nashville.

All GM said in a statement is that the SRX and a yet-to-be identified second midsize vehicle would "create or retain" about 1,800 jobs, while a $185 million investment in the Spring Hill engine factory would keep 390 jobs.

The complex now employs just over 2,300 workers, including hourly and salaried employees and those who work for parts supply companies.

Last year GM announced plans to invest $350 million in the Tennessee assembly plant to build two future midsize vehicles. The plant already builds several small gasoline engines plus the Chevrolet Equinox midsize SUV.

GM also announced Wednesday that it would invest just under $50 million at its Bedford, Indiana, engine block casting plant, keeping 45 jobs.

The company was holding a news conference at the Spring Hill factory on Wednesday to formally make the announcements.

The Cadillac SRX now is built at a GM factory in Ramos Arizpe, Mexico. That plant also builds the Chevrolet Sonic subcompact car and Chevy Captiva small SUV.

The United Auto Workers union, which represents Spring Hill factory employees, touted Wednesday's news as an example of how the union and company can work together.

"Today's announcement is proof we can achieve great things when workers have a seat at the table and the chance to share their ideas," union Vice President Cindy Estrada said in a statement.

Republican politicians like U.S. Sen. Bob Corker and Gov. Bill Haslam have been vocal opponents of the UAW gaining representation at a Volkswagen factory in Chattanooga. Workers voted against the union earlier this year. But the UAW has said it expects VW to recognize the union without another vote when it gets enough workers to sign membership cards.

GM hasn't identified the other new vehicle to be built at Spring Hill. But the state of Tennessee said in a July 11 news release that a nearby company was expanding to make parts for new GMC and Cadillac vehicles at the Spring Hill factory.

The new GMC likely would be produced on the same underpinnings as the Cadillac SUV, which likely will be redesigned for the 2016 model year.

It's possible that Chevy Equinox production at Spring Hill could go away in favor of the two new vehicles. The Equinox and sister vehicle, the GMC Terrain, already are assembled at two Canadian factories.

Crossover SUVs are in one of the fastest-growing segments of the U.S. auto market, appealing to young people and downsizing baby boomers. Sales of the midsize crossovers are up 14 percent so far this year, according to Autodata Corp., while overall U.S. auto sales are up 5 percent.

Crossovers are built on car underpinnings so they maneuver like a car and get comparable gas mileage. Drivers like the visibility of the high seating position and versatile cargo space.

Krisher reported from Detroit.

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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