A fog machine-induced haze enveloped GM's new luxury car, the re-designed 2010 Buick LaCrosse, during an unveiling ceremony at the Fairfax plant earlier this week. The special effect lasted only a few seconds. But the future of the plant and of GM is expected to remain hazy for a long time, despite a federal bailout package totaling $50 billion approved earlier this year.
More than 300 people attended the ceremony Tuesday at the huge Fairfax plant in Kansas City, Kansas. Top GM executives, local plant officials, area auto dealers and city, state and federal office holders heralded production of GM's newest Buick, while the assembly line workers responsible for building the plant's latest savior looked on. Reviewers writing for auto news publications compare the new Buick to the Toyota Lexus, which, for the past decade has been one of the industry's most luxurious and pricey models.
"For several years, the Lexus didn't have good competition," said Bob Wheeler, communications director for the Fairfax plant. The new 2010 LaCrosse, an updated version of the 2009 model, has "interior and exterior styling. It just looks a little sharper," Wheeler said. In fact, the new LaCrosse is so different from its predecessor that "if you put the two side by side you wouldn't know it was the same car."
With a price tag ranging from $27,800 to $34,000, and models featuring all the latest technology, the "American Lexus," has all the best features of the Toyota model, plus more, Wheeler said. For instance, the LaCrosse, noted for its smooth, quiet ride, even has fancy electronics, such as a built-in navigational system and DVD players in the rear seating area. Instrumentation displays on the dash allow drivers to keep their eyes on the road while quickly gauging such indicators as fuel levels and speed. An icon on the mirror alerts drivers contemplating a lane change if there is a vehicle in the dreaded "blind spot."
"Tough times alter the playing field," U.S. Sen. Sam Brownback, a Kansas Republican, told those gathered at the plant's Tuesday morning ceremony.
GM's struggle for solvency in a weak economy has meant dropping shifts, or even closing some plants across the country. Fairfax stands to gain from those losses, with company officials confirming Tuesday the addition of a third shift. The addition had been talked about earlier, but never confirmed. The extra hours of production add up to 900 more jobs at the plant in January.
The addition adds to Fairfax's status as a GM plant with the highest production numbers and highest number of employees. The plant also produces the popular Chevy Malibu.
"That's the best way to run a plant--to keep going," Wheeler said of the plant's plans to operate 24 hours a day, five days per week. "You're generating revenue with each car you're making."
A deep recession might seem an odd time to manufacture a luxury car, when consumers might be expected to more readily opt for an economical model, offering a lower sticker price coupled with higher gas mileage. However, GM officials are sure that the timing is just right.
The new production launch is just what consumers ordered, Susan Docherty, vice president and general sales manager, told the crowd Tuesday, and she pointed to early sales figures showing 2,600 of the vehicles have already been delivered to customers.
The demographics of LaCrosse buyers don't mirror those of buyers of smaller, more economical GM cars, such as the Chevy Cobalt or Equinox. The LaCrosse buyers are older, from mid-40's to 55, and more financially fit. In other words, GM LaCrosse consumers are among the nation's affluent who, in this recession-ridden economy, have become even more well off. During the Bush administration, the rich got richer while more middle-class Americans slipped into poverty.
GM officials are hoping to give the company a needed financial boost by catering to the rich who got richer during the recession. In the meantime, the company has re-designed models such as the Chevy Cobalt, appealing to an entry-level owner, with a starting price of $14,900 and 35 mile per gallon mileage.
GM's long-term goal? To re-pay the federal government for the bailout, which executives are careful to refer to as a "loan." However, Wheeler said the effect of the bailout was not just intended for automakers.
"The impact (of the auto industry's collapse) would have been beyond the Great Depression," he said, adding that one of seven people rely on the auto industry for a paycheck, from suppliers to dealers to truck drivers.
Wheeler said officials at GM, like those at other auto manufacturers, spend a lot of time and energy revamping older models, like the LaCrosse. Buicks traditionally appealed to the 65 and older crowd. GM has dropped other models altogether such as the Saturn, Pontiac and Hummer. In other words, the needs of automobile consumers are constantly changing and the market must change with them. That means anticipating upcoming changes.
"If you don't have a product people want to buy, you won't be in business," Wheeler said.
Car manufacturers nationwide are reeling from layoffs and plant closings due to sales dropping by 5 to 6 million vehicles from 2007 to 2009. But the trend is beginning to slowly turn around.
"It's not rebounding really quick, but it seems to be growing a little bit," Wheeler said, cautiously. "It looks a lot more positive than it has in the last 12 to 14 months,” he said, adding that automakers had been riding a "roller coaster that keeps going down."
While GM officials are cautiously optimistic, Wheeler noted that the re-designed LaCrosse alone can't save GM.
"It's going to take more than that," he said. "We need every car and truck to be a home-run like the LaCrosse...."