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VIDEOGM to Begin 9-Week Plant Shutdown
By
Scott Reeves Apr 23, 2009 11:00 am
Brief scrutiny of today's headlines.
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Many plants will be closed for up to 9 weeks, the Detroit Free Press reports. The planned closures will include the 2-week summer shutdown used to re-tool for the next model year.
General Motors had no comment on the report, but the newspaper, citing a “person familiar with the planning,” says the company will announce the plant closures Friday.
GM has used rolling plant closures in the last year. The planned closures will be felt throughout the auto industry, especially among parts suppliers.
Last month, GM said it had about 765,000 vehicles in stock, down about 108,000, or 12%, from the same period a year ago.
In the US, GM’s sales are down about 49% from last year. Automakers have been slammed by the global economic slowdown, including Toyota (TM) and Honda (HMC).
GM has received a $13.4 billion loan from Uncle Sam and may need about $5 billion more before the end of June.
GM appears ready to close the sale of a majority stake in Opel, its German unit, to Italy’s Fiat, in order to receive loan guarantees from the German government. The deal could be made as soon as next week.
Fiat is also discussing a partnership with Chrysler. Fiat seeks the backing of Chrysler’s creditors and unions to wrap up the deal by April 30, a deadline set by the US government.
No positions in stocks mentioned.
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