General Motors will start a third production shift at its Wentzville assembly plant, adding 750 jobs and deepening the automaker’s commitment to the facility.
The third shift will begin in the first quarter of 2015, said Nancy Laubenthal, GM Wentzville’s plant manager, told the Post-Dispatch.
The Wentzville plant, which currently builds Chevrolet Express and GMC Savana full-size vans, has 2,600 employees, and the added shift will bring employment to 3,350.
The plant also will soon start making GM’s next generation midsize pickups, the Chevrolet Colorado and GMC Canyon.
The anticipated demand for these new pickups, which will be available for sale this fall, factored in GM’s decision to increase production in Wentzville, Laubenthal said.
The Colorado and Canyon have been redesigned from versions that were made in Shreveport, La., before the assembly plant there closed in 2012. GM unveiled the new look of the pickups last November.
“We base our operating plan on market demand, and we see strong demand for the full-size vans that we produce here, and we expect strong volumes for the new pickups,” Laubenthal said.
There have already been dealer orders for nearly 30,000 Colorado pickups, and customers can go online to add options with a “build-your-own” capability at Chevrolet.com.
“That’s quite a high number so early in the process,” Laubenthal said.
The announcement by the automaker marks the first time in the plant’s 30-year history it will run three shifts, and brings stability to the region’s beleaguered automotive industry that saw the closure of local Ford and Chrysler plants in recent years, union officials said.
GM has hired many former Ford and Chrysler employees as it has expanded.
When the GM Wentzville plant opened in 1983, a single shift of workers produced the Buick Electra, Buick Park Avenue, and Oldsmobile 98. A second shift was added in 1985. A decade later, the plant switched from passenger cars to full-size vans.
The plant was dealt a setback in August 2009 when the second shift was laid off, leaving only a single shift.
“This is huge,” Mike Bullock, chairman of Local 2250 of the United Auto Workers, which represents GM hourly workers in Wentzville, said of the addition of a third shift. “It’s really a testament to the employees here.”
Three years ago, GM announced it planned to bring production of the pickups here and invest $380 million in the Wentzville plant by building a half-million-square-foot addition to its existing 3.7 million-square-foot plant, and adding or retaining 1,260 jobs. At the time, the plant only made vans and employed about 1,400 people.
Last year, GM’s announced it would also invest $133 million in Wentzville for a third stamping press system, adding or retaining 55 jobs. The two investments combined to add 1,315 jobs and a $513 million investment.
GM’s decision to add a third shift and 750 jobs is in addition to the jobs announced in 2011 and 2013. GM officials notified Wentzville employees about the expansion this morning.
“It’s a terrific vote of confidence in the plant,” Laubenthal said. “If you’re going to make a $500-plus-million-dollar investment in a plant, you want to get the most out of it, and a third shift does that.”
GM will draw from its existing labor pool to staff the third shift. The pool of applicants comes from referrals from existing employees and from the state’s career centers. Jobs that are available at the plant are posted on the US.jobs website.
Currently only six of GM’s 12 vehicle assembly plants are running three shifts, which is more profitable for the automaker.
“Adding a third shift at Wentzville will provide us greater flexibility and capacity to meet the needs of our customers for both our new midsize pickups and full-size vans,” Cathy Clegg, vice president of GM North America Manufacturing, said in a statement. “Today’s announcement demonstrates GM’s commitment to growing the business and strengthening plant communities that support us so well.”
Missouri Gov. Jay Nixon cited incentives available to auto manufacturers through the Missouri Manufacturing Jobs Act as a driver behind GM’s expansion. GM is eligible to receive $36.8 million over 10 years through the law, based on job creation.
“Four years ago we came together to pass historic, bipartisan legislation aimed at revitalizing the automotive industry in Missouri,” Nixon said in a statement. “Thanks to these efforts and our outstanding skilled workforce, the Show-Me state is now at the forefront of America’s automotive comeback.”
GM’s redesigned Colorado will be lighter, shorter and narrower than GM’s Silverado pickup, and designed to be the most powerful truck in the midsize segment.
There are only two rival vehicles in the midsize pickup segment, the Toyota Tacoma and Nissan Frontier, following Ford’s decision to stop making the Ranger and Dodge’s discontinuation of the Dakota a couple ago.
The number of midsize pickups sold in the U.S. in 2013 fell to 227,147 in 2013, down from 264,084 in 2012, according to Edmunds.com.
The announcement by GM comes as the industry is enjoying a surge in sales. The industry’s annual selling rate was 17.5 million in August, after being below the 17 million mark since July 2006.
“The confidence in the auto market is very strong, there’s pent-up demand and people are coming back in droves,” said Jessica Caldwell, a senior analyst at automotive consumer research website Edmunds.com.
Midsize pickups only account for about 1.5 percent of the market, according to IHS Automotive in Southfield, Mich.
Tom Libby, an IHS automotive analyst, said price-conscious customers may be attracted to the smaller pickup. Pricing for the new 2015 Colorado starts at $20,120, about $6,000 less than a base model Chevrolet Silverado.
“There is a slice of people that do not need the full-size bed,” Libby said there likely will be some cannibalization as some Silverado buyers switch to the smaller Colorado or Canyon.
With the new pickups, GM likely will seek to attract owners of crossover vehicles, such as the Ford Escape or Chrysler Pacifica, Libby said.
The growing crossover segment accounts for nearly 16 percent of U.S. auto sales, making it the biggest segment in the industry.
“I think their best prospects are to go after the active lifestyle,” said Michelle Krebs, a senior analyst at Atlanta-based AutoTrader.com of GM’s positioning of new Colorado and Canyon as sports and lifestyle-focused vehicles.
“GM is counting heavily in driving people who really don’t want full-size pickups as well as those who prefer a pickup over an SUV,” she said.
EDITOR'S NOTE: This story was updated on Sept. 23 to correct the name of the vehicles that were produced at the plant when it opened in 1983.