General Motors Co. GM declared that it will make an investment of $1.2 billion for new facilities and technology at the Fort Wayne factory in Indiana. The automaker manufactures Chevrolet Silverado and GMC Sierra pickup trucks at this factory.
General Motors expects that the investment will expand the size of the Fort Wayne assembly plant by 50%. The company will utilize this investment to equip the factory with new painting facilities, an expanded body shop and enhancements in the truck assembly area.
General Motors will start working on the project from June this year. It is expected that the project will require several years for completion. As there is a rising demand for better-quality trucks, this investment will be beneficial for the company. However, the automaker did not announce any plans to hire workers for this expansion.
General Motors is focused on making investments in innovative technologies and vehicles, which should provide sustained growth while maximizing shareholder value. In Apr 2015, the company announced that it will invest $5.4 billion for the improvement of plants in the U.S. over the next three years. The investment in the Fort Wayne factory is part of this investment plan. The automaker will undertake this investment in order to boost production and improve vehicle quality.
Apart from the Fort Wayne factory, General Motors will invest $783.5 million in three Michigan facilities. Of this, $520 million is for tooling and equipment, which will be used in future new vehicle programs at the Lansing Delta Township assembly plant; $139.5 million is meant for a new body shop and stamping facility upgrades at pre-production operations in Warren; and $124 million will be invested in the Pontiac Metal Center. The investment will be used for manufacturing cars, trucks and crossovers with improved design, enhanced quality and advanced technologies.
Further, in May 2015, General Motors announced that it plans to invest $1 billion in its Warren Technical Center campus. For this investment, which involves the expansion of its operations, the automaker will be hiring 2,600 new workers.
The automaker also outlined certain other plans related to its total investment. General Motors intends to spend $439 million to upgrade the Bowling Green, KY factory where it produces Chevrolet Corvette. Next, the company plans to spend $174 million for new equipment and technology at a Kansas City, KS plant. This investment will be used for the production of 2016 Malibu midsize sedan.
General Motors currently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the auto industry include American Axle & Manufacturing Holdings Inc. AXL, Lear Corp. LEA and PACCAR Inc. PCAR, all carrying a Zacks Rank #2 (Buy).
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