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GM Plant in Kansas City, KS

UAW workers at the General Motors Fairfax plant in Kansas City, Kansas stopped on Monday, January 28, 2013 to listen to General Motors CEO Dan Akerson announce a $600-million investment in the Fairfax Assembly and Stamping Plant, including the construction of a new 450,000 square-foot paint shop, the installation of a new stamping press and other upgrades. (David Eulitt/Kansas City Star/MCT)

KANSAS CITY, Mo. • General Motors plans to build a small Cadillac at its Fairfax assembly plant in Kansas City, Kan., instead of a plant in Michigan, according to a Wall Street Journal report on Monday.

Chris Bonelli, plant communications manager at GM’s Orion Assembly plant near Detroit, confirmed that automaker has scrapped a $245 million investment in the Orion plant and will shift planned production of a new model to Kansas City, possibly “three years out.”

Sources told the Journal that the car destined for Fairfax production is a Cadillac luxury product designed to compete with other premium small cars. GM officials declined to verify the Cadillac name.

The Fairfax plant now has three shifts building the new Chevrolet Malibu and the Buick LaCrosse. LaCrosse production at Fairfax will be phased out this spring, and new LaCrosse production will be shifted to Detroit, Bonelli said.

About 3,230 union employees and about 270 salaried workers at Fairfax have been informed of the production changes. Bonelli said Malibu production “should keep them busy for quite some time.”

No date has been announced for the new model to begin production at Fairfax, and Bonelli said GM isn’t saying yet whether the new model will require plant expansion.

“We’re not confirming the brand or type of product yet,” Bonelli said. “All we said production-wise was that it would be built in the next few years.”

Last year, GM spent about $174 million to upgrade Fairfax in preparation for building the redesigned Malibu.

The gain at Fairfax is a loss for the Orion plant, which previously had been told it would get the new car model.

Bonelli said the switch from Orion to Fairfax was decided after an “asset utilization and capital efficiency” analysis that showed cost benefits for GM to build the new model at Fairfax.

The new model report is more good news for the Kansas City area’s automotive industry. Ford Motor Co.’s assembly plant in Claycomo employs more than 7,000 workers who build the top-selling F-150 pickup truck and the new Transit utility van.

The Kansas City region also is home to a growing number of auto parts suppliers who collectively employ more than 1,800 workers. The “feeder industry” is choosing to locate production facilities and warehouses near to the two major assembly plants to improve logistics.

The Orion assembly plant will begin to build the Chevrolet Bolt electric car at the facility later this year.

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