Diesel line to extend life of GM plant - Buffalo Niagara Enterprise

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Diesel line to extend life of GM plant

Published on June 16, 2007
Fred O. Williams - NEWS BUSINESS REPORTER

General Motors announced Friday that it will invest $100 million at its Tonawanda Engine Plant to produce a new diesel engine for pickup trucks and SUVs -- a first for the automaker and its local plant.

While it may not generate new jobs, the V-8 turbo-diesel extends the life of the 1,860-job factory. "This is a seed you are planting that will bear fruit for years and years to come," Gov. Eliot L. Spitzer said during the ceremony at the factory on Vulcan Street. The state announced a $1 million grant to support the automaker's investment.

GM will begin to produce the 4.5-liter motor in 2009 within an existing building at its plant complex in the Town of Tonawanda.

"This will be one of the most efficient and advanced diesel engines," said John Buttermore, the GM vice president who made the announcement.

The "Duramax" diesel will have 25 percent better fuel efficiency than comparable gas engines, as well as new pollution-control technology, he said. It will be available as a premium option in Chevy Silverado and GMC Sierra pickups and the Hummer H2 after 2009.

The motor -- the second awarded to Tonawanda this year -- protects about 150 hourly jobs. In January, GM awarded a V-8 gasoline engine that will power future luxury cars to the plant, triggering a $300 million plant investment.

"This is nice, coming back here every four or five months," United Auto Workers Assistant Region 9 Director Kevin Donovan said, referring to the earlier announcement. "It shows we can be competitive in America and we can be competitive in New York State."

Gaining new products strengthens the plant's business base and, by absorbing overhead costs, increases Tonawanda's overall efficiency. That in turn improves the chances of attracting future engine projects, Donovan said.

"We are the last GM plant in the area -- therefore we are like the Alamo," said Wallace Wedington, chairman of UAW Local 774 at Tonawanda. "But we are not going down without a fight."

The union, which agreed to a productivity-boosting agreement to win new products, hopes demand will exceed expectations and create new jobs, he said.

In May, the Erie County Industrial Development Agency approved a $350,000 tax break for the engine plant, contingent on the investment for the diesel.

In addition to the $100 million spent on the plant, $41 million will go for tooling and for supporting investments in other locations, GM said.

With an expected output of 400 a day, the diesel will be a relatively small product at Tonawanda, which makes four-, five-, six- and eight-cylinder gas engines for some of GM's biggest-selling cars.

But the new engine represents a breakthrough cure for the pollution, noise and sluggish acceleration that have made diesels a rarity in the U.S., company officials said.

Diesels are currently unavailable in new cars and light-duty trucks in New York because their emissions violate pollution standards -- chiefly for nitrous oxides.

The new Duramax will be the first to have a catalytic after-treatment system to cut nitrous oxides by 90 percent versus today's technology, the company said.

GM currently makes a 6.6-liter Duramax diesel through a joint venture with Isuzu. That engine powers heavy-duty work trucks, which face looser emission standards than light-duty vehicles. In Europe and other foreign markets, GM sells 17 diesel variants for cars as well as trucks.

The premium price on the new 310-horsepower Duramax diesel isn't determined, but the catalytic emission system may add $1,000 to the vehicle's cost, said Jim Minneker, assistant chief engineer of GM's diesel unit.

When towing or hauling heavy loads, diesel's high-torque performance can boost fuel efficiency 40 percent to 70 percent over gasoline, he said.

"You can recover the premium cost over the life of the vehicle," he said. GM's strategy is to roll out diesels in working vehicles that can take best advantage of the superior torque. While there are no plans now to introduce diesel passenger vehicles, GM has diesel designs in Europe that could be modified for U.S. cars, Minneker said.

West-Herr's GM dealership in East Aurora sells one or two work trucks a month outfitted with a diesel engine, sales manager Don Graham said. "The market is strong on used ones, because there's not many around," he said. However, he doesn't see customers clamoring for more of the alternate fuel technology as gasoline prices rise.

"We haven't seen any real change," he said.

But GM said that its share in heavy-duty pickups has increased tenfold since the Duramax was introduced in 2001.