2009 Archives

GM's Arlington plant to start SUV production again


The following is from the July 13, 2009, edition of The Dallas Morning News. Professor William Maxwell, who holds the Rauscher Chair in Financial Investments in SMU's Cox School of Business. provided expertise for this story.

July 13, 2009

The Dallas Morning News

After two months of silence, sparks will fly again Monday at the General Motors Assembly Plant in Arlington.

The factory's 2,400 workers will come to work for the first time since May 18, welding and bolting together Chevrolet Tahoe, GMC Yukon and Cadillac Escalade SUVs.

In a dramatic push to slash inventory, General Motors Corp. closed 13 of its North American factories for two months – one of the longest shutdowns not related to a strike that workers have endured. During the shutdown, GM filed for bankruptcy. . .

The looming August shutdown – coming only three weeks after the two-month closure – is "shocking," said William Maxwell, a professor of finance at Southern Methodist University who follows the auto industry.

With all the shutdowns, production cuts and supplier problems, the auto industry is obviously "out of sequence," he noted.

GM's managers are probably being highly cautious in their production decisions. The U.S. government owns a controlling interest in the company, forcing GM executives to answer to legions of federal officials, Maxwell said.

"Think about how many CEOs GM has: 435 in the House, plus 100 in the Senate, plus every top official in the administration," he said. "If you're a top manager and make a bad decision, it could result in your being called before a congressional committee."

Read the full story.

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