Friday, April 10, 2009

Who's playing politics on Spring Hill: Corker or Obama?

This week, Tennessee Sen. Bob Corker has been warning the Obama administration on closing his state's Spring Hill GM plant.

Before getting into specifics, here's the train of thought that seems to be running thru Corker's head -- if the government has too much power, they got it via a political grab, and political grabs can only be sustained by political moves, which always center around the executor's best interest (in this case Obama's).

Under that line of thought, closing Spring Hill is as blue a decision as can be.

For example, in his press release this week, Corker makes the broader point that government power's has gotten out of hand. Then, more specifically, he recounts his fight against the bailout last year, Obama's power plays this year, and concludes that the specter of closing a plant exists purely for political reasons.

Why does it have to be a political reason?


If the administration uses factors like efficiency, flexibility and the quality of the workers, our modern, adaptable GM plant in Spring Hill should do very well. Spring Hill is the kind of facility that represents what made the American car industry a world leader in technological innovation. Hopefully it will play a key role in GM's resurgence.

(ea) So what about efficiency and flexibility? (we'll go under the assumption that the 2,911 hourly workers in Tennessee and their colleagues up north don't vary much in work ethic).

As you might guess, there seems to be a geographical divide on who's more efficient and flexible.

We'll start with flexibility.

Professor James Rubenstein, a specialist in auto plant site selection for Miami University, says Spring Hill loses:

"Does Spring Hill have something to worry about? Yeah. If you look at a map, the farther away from Michigan, the more vulnerable" [a plant is].

But is flexibility just a geographical thing?

What if Spring Hill does something unique?

Well, they once did, and if you make a stretch, you can say they might.

Auto Observer:

The Spring Hill plant became vulnerable awhile ago when GM spread the assembly of Saturn, once made exclusively in Tennessee, throughout the rest of GM's manufacturing operations. The plant got a reprieve when GM selected it to build the Traverse.

But does the Traverse alone make Spring Hill worth saving?

The Detroit Free Press:

.... a newer plant in Lansing is already producing three other vehicles on that same platform. And Lansing is much closer to suppliers than Tennessee.

Add to that the fact that larger trucks, SUVs and CUVs like the Traverse could take a hit if Obama's auto team demands a more aggressive move to fuel-efficient sedans.

Asked if Spring Hill is vulnerable, auto analyst Erich Merkle of Grand Rapids said, "There's no question."

(ea) Remember the bolded name.

The Detroit Free Press released a piece today titled "Look who wants to protect a GM plant" in which they glittered the above in glee.

But completely missing from either pieces are more words from the same Erich Merkle:

"Spring Hill could be on the bubble because it's in a red state, and Michigan is a blue state. The governor of Michigan is a Democrat, too, and she needs all the plants she can get."

Not quite as slam dunk as the Free Press makes Merkle out to sound.

David Cole, chairman of the Center for Automotive Research in Ann Arbor, Michigan, says that, in the end, it's difficult to determine what should be saved and what shouldn't, and ultimately, there's probably politics mixed in there, as there is in everything.

"Spring Hill is still a relatively new plant and has been refurbished to make it much more flexible than it has ever been. It's a very good plant, and when the economy recovers, those GM crossover vehicles are going to be very strong.

It would be a shame for GM not to be able to meet consumer demand because they closed one of the plants. If they walk away from that plant, that would be a very strategic error, but in politics anything is possible."

Bu there's always this: whoever loses practically may be able to gain something politically.

Obama could keep Spring Hill and talk bipartisan while angering some in Midwestern battlegrounds.

On the other hand, Corker could lose Spring Hill, but gain another national cause by blaming politics. And that's not all: he could also pivot from national to state concerns by taking a public stand to save the local plant.