GM Plans $5.4 Billion in U.S. Plant Investments

By John D. Stoll 

PONTIAC, Mich.-- General Motors Co. laid out a plan Thursday to invest $5.4 billion in U.S. factories over the next three years, an announcement that comes on the eve of summer contract talks with the United Auto Workers.

The announcement, taking place at a stamping plant in a Detroit suburb, includes at least $785 million earmarked for plants in Michigan. It is unclear what level of government incentives or job commitments are attached with the investment plan.

Michigan facilities in Lansing, Pontiac and Warren will benefit from the plan.

GM's decision to outline billions in U.S. investment is a common strategy for Big 3 auto makers in advance of quadrennial labor talks with the UAW. Flush with profits, GM, Ford Motor Co. and Fiat Chrysler Automobiles are expected to be pressed for pay increases or richer profit-sharing plans.

This week GM won approval for $30 million in tax incentives from Arlington, Texas, officials. The deal paves the way for a $1.3 billion expansion of an SUV factory to boost capacity of some of the auto maker's most profitable vehicles and add about 600 new jobs.

GM posted its highest North American profit in the first quarter since emerging from bankruptcy--a result coming amid sizzling U.S. auto sales and strong demand for trucks and SUVs. Its 8.8% operating margin in the region is near the company's 10% near-term margin target.

Write to John D. Stoll at [e-mail]

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