August 12, 2014 online at www.uawlocal2250.com
• There will be an Education Committee meeting Wednesday, August 13 between shifts in the cafeteria. As always, anyone interested in attending and becoming a member is welcome.
• The Annual Women’s Committee benefit golf tournament will be held Saturday, Sept. 6 at Country Lake golf course in Warrenton. It is a 3-person scramble with a 1:30 pm shotgun start. Cost is $210 per team/$70 per person and includes prize money for the first 3 places in 3 flights, longest drive and closest to the pin contests as well as Food and beer that will be served after the tournament. Entry forms are available at the entrances. Proceeds will benefit the St. Louis Crisis Nursery which serves children and families of St. Charles, Warren, Lincoln, Pike, Franklin and Jefferson Counties as well as St. Louis City and County and East St. Louis.
• From the Detroit News: General Motors Co.’s Lansing Grand River Assembly Plant will halt production for three weeks starting Aug. 18 due to lower than anticipated market demand for the luxury cars built there, according to two people familiar with GM’s plans. Production is set to resume Sept. 8, according to one person with knowledge of the company’s plans. The plant builds the Cadillac ATS and CTS sedans. Cadillac ATS sales are down nearly 21 percent through July this year, while CTS sales are flat year-to-date. But sales of the CTS — redesigned for the 2014 model year — in July fell more than 29 percent from July 2013. The compact ATS was all new as a 2013 model and won North American Car of the Year that year. The CTS took home Motor Trend Car of the Year honors for 2014. “We don’t share our production schedules with outside parties,” GM spokesman Bill Grotz said. “We build to market demand.” Lansing Grand River employs about 1,600 workers, including about 1,400 hourly employees who are represented by UAW Local 652. The plant, which runs two shifts, is set to begin building Cadillac’s new 2015 ATS Coupe this fall.
• Consumer Reports, who gave the Tesla Model S the highest test score ever awarded, is now reporting on how the ($89,650) car has held up during continued testing. The short answer - not very well. Here is a brief recitation of things gone wrong or replaced/repaired in the first 15,743 miles: center screen (which controls virtually every function) went blank and needed a “hard” reset; broken 3rd row seat buckle; front bumper carrier hardware; 12 volt battery; HVAC filter housing; powertrain battery coolant pump; decklid release inop; charger adapter came apart; passenger side roof pillar “creak”; malfunctioning retracting door handles. CR said they “might” have to lower the car’s reliability ratings.
• From Automotive News: Skeptics of General Motors' decision to revive its smaller pickups say GM is headed down a dead-end road: Buyers simply prefer to pay a bit more and get a bigger truck, the thinking goes. But an Automotive News review of more than a decade of pricing, inventory and sales data shows that market dynamics have shifted in the years since compact pickups (now commonly called mid-sized) fell out of favor. The pricing delta between the smaller trucks and their bigger showroom siblings has widened considerably in recent years, creating more breathing room for mid-sized offerings priced from $20,000 to the low $30,000s.
The data suggest that GM's contrarian move to re-enter the segment this fall with the new Chevrolet Colorado and GMC Canyon comes at an opportune time. The move is still a gamble -- one that GM's main truck rivals see no reason to take for now -- given the epic collapse of the smaller-pickup market during the past 15 years. Smaller trucks such as the Ford Ranger and Chevy S-10 were the rage in the 1990s, outselling full-sized pickups in some years. Then, steep discounts on the bigger trucks, lubricated by overproduction, shortened the pricing ladder between the two segments. Encouraged by cheap gasoline prices, buyers opted for more truck. As a result, U.S. sales of compact pickups shriveled to just 227,111 trucks last year, from more than 1 million in 2000, according to the Automotive News Data Center.
But in recent years, restrained production and insatiable demand for content and features on full-sized pickups have tamed discounts and pushed prices to gaudy highs. Net prices -- average transaction prices that factor in incentives such as lease subsidies and cheap financing -- hit a record $37,568 in the first half of the year, Edmunds data prepared for Automotive News show. From 2011 through the first half of 2014, net prices on full-sized pickups were 43 percent higher on average than on mid-sized trucks. That's a sizable jump from the nine-year period from 2002 to 2010, when they were 34 percent higher on average. The gap could grow in coming years as Ford leads what is likely a broader transition to more-expensive aluminum bodies to improve fuel economy. Ford is raising prices for its 2015 aluminum F-150 pickup by as much as $3,615. "We've seen [full-sized] truck prices rise so much in recent years, it does leave a void in the market for smaller trucks with decent content and amenities," Edmunds senior analyst Jessica Caldwell says. "The timing is as good as it's been in at least a decade."
It was a different story when GM launched the first-generation Colorado and Canyon in 2004, as successors to the popular S-10 and GMC Sonoma. Back then, a top-trim 2005 Colorado Z71 crew cab was $28,550, about $6,200 cheaper than a Silverado Z71 crew cab. For 2015, the gap between those models is more than $11,000. Rick Cantalini, general manager at Vandergriff Chevrolet in Arlington, Texas, was on a dealer advisory committee for the first Colorado. He says it was a decent truck but never sold well because "the way Silverado was priced, they were stepping all over each other." Today, GM has "stayed restrained on Silverado rebates" for the redesigned truck, Cantalini says. "They've preserved that space for Colorado."
GM must maintain that discipline to avoid the price blurring of the past, says AutoPacific Inc. product analyst Dave Sullivan. He believes having an adequate price spread is crucial to GM's strategy of being the only automaker to offer all three flavors of pickups: mid-sized, and full-sized trucks in both light- and heavy-duty versions. For now, forecasters are taking a cautious view of GM's mid-sized truck gambit.
Forecasts for combined sales of the Colorado and Canyon next year, by IHS Automotive, AutoPacific and LMC Automotive, range from 73,000 to 91,400 trucks. That is well below the historical volume of the Toyota Tacoma, which has accounted for about two-thirds of mid-sized sales in recent years, and a fraction of the combined 664,803 Silverados and Sierras sold last year. GM officials won't provide a sales target.
Tom Brune
UAW Communications Coordinator
Wentzville Assembly
636-327-2119
