SPRING HILL, Tenn. - General Motors announced plans Monday morning to idle production later this year at the U.S. automaker's assembly plant in Spring Hill.
The news came shortly after GM filed for Chapter 11 bankruptcy protection as part of the Obama administration's plan to shrink the automaker to a sustainable size and give a majority ownership stake to the federal government.
The Maury County plant employs around 2,500 people and is one of 12 plants to either be closed permanently or idled.
Assembly plants in Pontiac, Michigan and Wilmington, Delaware will close this year; Powertrain plants in Livonia, Flint and Ypsilanti Township, Michigan, will close next year, along with plants in Parma, Ohio, and Fredericksburg, Virginia. Stamping plants in Indianapolis and Mansfield, Ohio, will also close.
An assembly plant in Orion, Michigan will remain on standby, like Spring Hill, in addition to a stamping plant in Pontiac, Michigan.
In Spring Hill, a union spokesman said production is scheduled to cease in the fourth quarter of 2009.
Assembly of the Chevrolet Traverse crossover SUV currently produced in Spring Hill will be moved to Lansing, Michigan.
GM said the plant will continue building engines for other GM cars and the stamping, polymers, service parts and Powertrain operations in Spring Hill will continue.
While there will be no immediate job loss and employees will still be paid a portion of their salary, layoffs could occur when the plant goes idle.
Employees in Spring Hill will have the option of moving to the Lansing area if they choose to do so.
It is unclear how long the plant will remain idle.
Longtime United Auto Workers Union member and local 1853 newspaper editor Todd Horton said Monday morning that resumption of production would depend on market conditions.
Mike Herron, chairman of the UAW Local 1853, said the news "is not as bad as it could be."
"I'm an optimist," he said. "We would have preferred the Traverse continue to be built. The absolute worst would be a plant closure."
The Spring Hill facility is in the running to build the next generation small car GM had originally planned to build in China.
The automaker considers a new subcompact car key to the company's survival and Herron thinks Spring Hill may have a leg up because the recent retooling to build the Traverse gave the plant the most modern equipment in GM.
"There's a billion dollars worth of equipment put in this place over the last 18 months," he said.
In addition, Herron said the UAW local and Spring Hill work force have agreed to operate the plant seven days a week without overtime.
The plant has had more flexible work rules than others thanks to its history.
Car production began there in 1990 with the Saturn, GM's small-car answer to Japanese competitors.
The factory made more than 3.7 million vehicles for the Saturn brand until 2007, when it shut down for the Traverse retooling.
Full-scale production of the Traverse started in October 2008.
The plant is up and running until a temporary, five week previously scheduled shutdown begins on June 8.
GM's bankruptcy filing is the fourth largest in U.S. history and the largest for an industrial company.
The company said it has $172.81 billion in debt and $82.29 billion in assets.