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South Gate Hopes Report Will Prompt GM to Reopen Plant

January 17, 1985|RALPH CIPRIANO | Times Staff Writer

SOUTH GATE — City officials have spent $35,000 on a report they hope will convince General Motors Corp. to reopen its plant on Tweedy Boulevard, which has been closed for nearly three years.

A GM spokesman this week said company officials are studying the report and will take it into account when they make a final decision later this year on what to do with the plant.

The report, paid for with a state grant, suggests that GM renovate and reopen the 49-year-old facility or sell or lease it to another auto maker.

GM, once the largest employer in South Gate, closed the plant during a sales slump in March, 1982, at a cost of 4,300 jobs and $350,000 in annual property taxes to the city.

City officials said this week that they hoped that the 89-acre facility would be considered as a manufacturing site for GM's new Saturn, a subcompact to be sold later this decade. GM officials had announced earlier this week they would invest $5 billion in the new Saturn Corp., a GM subsidiary, and were looking for a production site. But the GM spokesman said Tuesday that the new car probably would be built at a new plant at a yet undisclosed site.

Reaction Frustrates Officials GM's reaction to the report and its plans to locate Saturn production elsewhere continued to frustrate city officials, who said they are willing to do anything "humanly possible" to get the corporation to reopen the South Gate facility, the only idle GM plant in the country.

South Gate Chief Administrative Officer Bruce Spragg said the city needs the taxes and jobs the plant would generate if reopened because "generally, the city is not solvent."

During the past two years, the city has balanced its budget only through one-time payments. The city received $1 million in 1983 for awarding a cable television franchise and $1.7 million last year for the sale of city property.

"The thing that's killing us is the mothballing of the plant for the past three years," Spragg said.

In the report, the city has proposed building a parking garage for GM on the site at an estimated cost of $16 million in anticipated federal money. It also offered to build an underground 5-million-gallon reservoir to be paid for with federal or local money, officials said.

"We don't hold the trump cards. They (GM) do," said Councilman Bill DeWitt. "But we didn't want to leave a stone unturned in working with them to reopen that plant because if there's anything humanly possible to do, we're willing to do it."

Darwin Allen, director of media relations for the Chevrolet-Pontiac-Canada Group of GM, said that the South Gate report has been looked at by numerous GM officials, including site and plant engineers.

Under Review

"I can assure South Gate officials that it (the report) is not in the file drawers some place. It's actively being reviewed," said Allen in an interview from his Detroit office.

The South Gate plant, which produced Chevrolet Chevettes and Pontiac 100s, is owned by the Chevrolet-Pontiac-Canada Group.

Councilman Henry Gonzalez has considerable interest in the GM plant because he is assistant director of the regional office of the United Auto Workers, which includes California and eight other states.

'We don't hold the trump cards. GM does.' --Councilman Bill DeWitt "We're saying, 'Hey, GM, if you can't reopen, then let's do something to get some jobs in here,' " Gonzalez said, adding that GM has a "moral obligation" to help the city after operating in the city for nearly half a century.

"When the plant went down, it was devastating," he said. "We had stores and gas stations close down and people leaving the city."

Since the plant closed, all but 500 of the 4,300 workers have been reassigned to GM plants around the country, including Wentzville, Mo., Kansas City, Mo., Shreveport, La., and Arlington, Tex. More than 600 workers lived in South Gate, and most have since left town, Gonzalez said.

City officials said their report will be distributed to state officials and in the future may be used as a marketing tool to interest other businesses in the facility.

Spragg said that if GM decides to sell the plant, the report would provide valuable insight into the plant's resources and potential. The plant was valued at $108 million when it closed, but since then about $50 million in equipment has been removed, city officials said.

The report, prepared by Anthony/Fleming & Associates of Oakland, an architecture and urban design consulting firm, said GM could renovate the plant to include new robotic equipment at a cost of between $50 and $150 million or establish a joint venture with Asian auto makers, such as Toyota and Isuzu of Japan, or Daewoo Motor Co. of South Korea.

The report also suggested renovating the plant to produce auto components or converting the plant for high-technology electronics, computers or robotics or to produce buses and trains.

The report said the plant was expanded as recently as 1980 and is "easily adapted to contemporary production processes and methods."

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