One of the world’s largest and most profitable automakers company is General Motors, for more

than half a century it was dominant in the industry, involves a wider scope of industrial activity
with main focus on manufacturing, engineering and motorized transportation. It was founded in
1908 by William Durant as holding company in Flint, Michigan. The original GM plant is
located north of downtown Flint, Michigan termed as Factory One. It is modest two story brick
building having unforgettable history, builds upon the heritage of revolution, courage and
resilience that revolved Flint to a town on wheels from a lumber town and leading to the
establishment of General Motors in 1908.

Appoximately how many workers lost their jobs when GM closed their doors in MI?

Increase in oil prices and competition from foreign auto manufacturers badly affected GM Corp
from the start of 1970. In the first phase of reorganization and modernization program and to cut
costs and to recapture it’s competitive advantage. The management of General Motors decided to
close down eleven plants between 1987 and 1989, abolishing 29,000 jobs or more than 5% of its
workforce in the four states of United States throughout the Midwest during the next three years.
The closing of old plants does not affect potential capacity of GM as the operational plants are
more modernized and automated ones having higher capacities. The shutdowns were part of $10
billion GM program in order to acquire efficient plants with advance technology by replacing
outdated one resulting in a fixed cost reduction of $500 million annually. These remedial steps
were taken in order to maintain market leadership and to provide enhanced job security to the
existing work force.

As a result how was the economy impacted in the northern Detroit suburbs of Oakland
Country, Michigan ?
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But the closings were seen as a hard blow to Michigan's economy and extremely
damaging to other states in the region. [ Page D10. ] G.M., the nation's largest auto
maker as well as its largest company, currently has 149 plants and warehouses in the
United States. The 11 facilities earmarked for closings include six of G.M.'s 30 assembly
plants in the United States and are currently producing 730,000 cars and trucks a year,
the company said.

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It was unclear yesterday just how many of the employees at the plants would lose their
jobs. Under contractual agreements between G.M. and the United Automobile Workers
union, some employees may be able to transfer to other G.M. plants or be retrained for
other jobs at the company.

But U.A.W. officials noted that many of the most senior employees at the facilities had
already transferred to other plants, reducing the chances that the remaining workers,
with less seniority, would be offered jobs elsewhere.

Harvey E. Heinbach, an analyst at Merrill Lynch & Company, estimated that the plants
to be closed accounted for 10 percent of G.M.'s annual North American production
capacity of nine million vehicles.

Mr. Smith, however, said the closings ''won't reduce our capacity all that much with the
new and modernized plants coming on stream.'' And Mr. Smith stressed that the
reduction would lower G.M.'s annual fixed costs by $500 million.

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