Special Report

UAW logo2007 UAW
Labor Talks

General Motors Corp., in its tentative agreement with the United Auto Workers union, says it will continue to build Chevrolet and GMC large vans at its Wentzville, MO, assembly plant through 2012.

As for the next-generation large van, GM says it will go to Wentzville, if there is enough demand and a strong enough business case.

A list of GM product commitments is contained in the tentative agreement, a summary of which was posted on a dissident UAW website. It suggests the situation at Wentzville is unclear beyond 2012.

If demand does not warrant a replacement for GM’s fullsize vans – the Chevrolet Express and GMC Savana – then what’s to become of Wentzville’s 2,083 hourly and salaried workers come 2012?

One possibility is that GM could change strategies and move away from building traditional large vans, and towards a European-style commercial van, along the lines of Ford Motor Co.’s Transit and Chrysler LLC’s Dodge Sprinter vans. GM has similar products on sale in Europe, such as the Vauxhall Movano.

Wentzville builds some 734 vehicles per day, and sales of its products have been declining, according to Ward’s data. Through September, Express deliveries were down 11.2% to 85,016 units vs. like 2006, while GMC Savana sales slipped 15.8% to 20,693.

However, the entire large-van segment also is off 8.4% with deliveries totaling 247,665 so far this year.

A GM spokeswoman attributes the downturn in sales to a weak housing market, noting that the majority of fullsize van sales are for commercial use. She declines to comment on GM possibly transitioning from a traditional fullsize van to something like the Movano, which is assembled in France as part of a joint venture with Renault SA.

The spokeswoman does say the fullsize van segment still plays an important role in GM’s lineup. “We’ve invested a lot of time and money (in the product),” she tells Ward’s.

Those on the ground selling the fullsize vans also see them as a key product in GM’s lineup.

Dan Dilay, a new car salesman at Hamilton Chevrolet in Warren, MI, says the vans are still selling well and he has heard no rumors of switching to a European-style type van.

“I don’t see them changing (to a new style van),” he says. “The higher the van, the more stabity problems it has. (Traditional) vans are a particular item they’ll always need.”

The National Highway Traffic Safety Admin. has not rated the Sprinter for rollover risk and it is not among the ’08 models scheduled for testing. However, the vehicle does feature electronic stability control.

Gary Styles, president of UAW Local 2250, which represents workers at GM’s Wentzville plant, says he’s not sure what to make of the contract’s wording regarding his plant.

“As far as being business-case dependent, I’m not sure what (GM is) asking for,” Styles tells Ward’s, noting Wentzville currently is running on overtime.

“They’ve got to make a profit,” he says. “I imagine that’s what they’re talking about, but that’s all speculation.”

Warns Dave Cole, chairman of the Center of Automotive Research in Ann Arbor, MI: “It’s impossible to look that far in the future and make concrete decisions. If that product does not work because of, say, CAFE standards, they’ll have to revisit that particular issue.”