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Home > About BNE > Press Room > 2007 Archive > June > GM picks plant here for new diesel line







GM picks plant here for new diesel line

Published on June 15, 2007
Fred O. Williams - NEWS BUSINESS REPORTER

General Motors plans to announce today that it has selected the Tonawanda Engine Plant to produce a new diesel engine, a first for the plant and an innovation for the world's No. 1 automaker.

GM wouldn't confirm the subject of the afternoon announcement, but an official with knowledge of the situation said the long-expected diesel will arrive.

GM said that John Buttermore, vice president of the Powertrain division, is scheduled to attend the afternoon announcement, with Gov. Eliot L. Spitzer, Lt. Gov. David Paterson and officials from the United Auto Workers and local government.

GM has previously confirmed that the Town of Tonawanda plant was in the running for an $88 million investment to produce a new diesel. "It's important for Tonawanda and for the entire region," Town Supervisor Ronald H. Moline said of the investment.

"We get $1 million in taxes from GM on this facility. That's important revenue," he said -- adding that the larger economic impact is GM's local payroll of $250 million.

It was unclear Thursday whether the new product will add jobs at GM or protect the 1,860 already there. Company and UAW officials wouldn't comment.

However, GM has previously discussed plans to offer a 4.5-liter diesel in some pickup trucks and SUVs for the 2010 model year.

It and other automakers are embracing diesel technology as fuel suppliers clean up pollutants to meet new U.S. standards. A diesel engine can have 25 percent higher fuel efficiency than gas burners.

Currently, GM offers diesel engines in the U.S. in commercial-duty vehicles.

The Erie County Industrial Development Agency in May approved a $350,000 tax break for the plant, contingent on the new investment.

GM has described the investment to produce the diesel as an $88 million addition to an ongoing expansion of its Plant 5, on the Vulcan Street side of the complex.

In January, the automaker announced a $300 million investment at the plant to build new V-8 gasoline engines for luxury cars. The investment is supported by a $5 million grant from the Empire State Development Corp.

The factory alongside the Niagara River makes a range of gasoline engines that power everything from Saturn Ions to Hummers and commercial-duty trucks.

The Tonawanda plant has a long history of producing GM's newest engines. The diesel would represent another innovation beyond the plant's gasoline-powered product line, plant officials have said.

"It's important to keep that plant viable," Moline said. The Town of Tonawanda and Erie County are splitting the expected $1.5 million to $2 million cost of street improvements around the plant to support GM's investment, he said.

Among the officials expected to attend the announcement, according to GM, are Erie County Executive Joel Giambra, Empire State Development Corp. Chairman Daniel Gundersen and Kevin Donovan, assistant Region 9 director of the United Auto Workers.

The Tonawanda Engine Plant recently ranked among the 10-most-efficient auto industry engine plants in North America, according to the widely watched Harbour Report, issued by a Troy, Mich., industry consultant.