Ehrlich, O'Malley join in effort to save Baltimore GM plant

Contingent visits Michigan to save Broening Highway GM Plant

by David Nitkin and Stacey Hirsh
Originally published in the Baltimore Sun, December 2, 2003

Gov. Robert L. Ehrlich Jr. and Mayor Martin O'Malley put aside simmering political differences yesterday and made a joint pitch to keep an aging Baltimore General Motors plant open, an effort that industry analysts say is unlikely to have much impact.

Ehrlich and O'Malley flew with U.S. Sen. Barbara A. Mikulski and U.S. Rep. C.A. Dutch Ruppersberger for an afternoon meeting over deli sandwiches with GM executives in Warren, Mich.

The topic was how to keep top-paying GM manufacturing jobs in the region if the company stops producing its poorly selling vans at the Broening Highway plant in 2005.

"We knew that we were not in a position to ask for any particular promises, nor were they in a position to deliver," Ehrlich said during an evening news conference at Baltimore-Washington International Airport after he and the other politicians returned from their daylong mission.

The governor said he thinks GM officials were impressed with the cohesiveness of the delegation and with proposals from state economic development chief Aris Melissaratos to create a free-trade zone around the Baltimore plant and to remodel the plant to produce specialty cars and trucks.

Industry experts said the high-profile political effort probably won't forestall the expected closing.

"From everything we heard coming out of these union negotiations, it's almost a done deal," said Mike Wall, an analyst with CSM Worldwide, an automotive forecasting firm in Farmington Hills, Mich.

The Baltimore plant is expected to produce about 50,000 Chevrolet Astro vans and GMC Safaris this year, down from about 77,000 last year and 82,000 in 2001.

"If somebody wants to tow something, they're going to get an SUV. If someone wants to people-haul, they're going to get a minivan. ... The Astro-Safari is a vehicle that's not long for this world," Wall said.

GM executives were polite but noncommittal after the meeting. Company spokesman Dan Flores said no final decision has been made on the future of the Baltimore plant.

Tensions between Democrat O'Malley and Ehrlich, the state's first Republican governor in 36 years, have reached new heights.

Last week, the mayor sued Ehrlich over his choice of a director to run the Baltimore Department of Social Services, an appointment that is supposed to be made jointly by the two officials.

The mayor complained that Ehrlich had unilaterally named Floyd R. Blair, whom O'Malley described as unqualified.

In October, O'Malley rejected Ehrlich's endorsement of Comptroller William Donald Schaefer, a critic of the mayor, for a spot on the city convention and visitors association.

O'Malley and Ehrlich said they did not discuss the social services appointment or other political issues during their flight on Northwest Airlines or their time in Michigan.

"The talk was all about the men and women of the GM plant and how we can come together as one team for them," the mayor said.

Mikulski said the visit was designed for Maryland politicians to meet Joseph D. Spielman, GM's new vice president and general manager for vehicle manufacturing.

'Partnership politics'

"There is a changing of the guard in Detroit," she said. "We went out there to build a relationship. But at the end of the meeting, what they said was they had never seen a delegation of such heavy hitters" practicing "partnership politics."

Analysts said there is little the city or state can do to eliminate the threat of closing that has hung over the Broening Highway plant for years.

As production has steadily declined, employment at the plant has shrunk from nearly 4,000 a decade ago to 1,100 on a single shift.

The company's latest contract agreement with the United Auto Workers union, announced in September, paved the way for the plant's demise with language that would allow the closing of the Baltimore plant and two others.

GM has said the Broening Highway plant will stay open through at least the summer of 2005.

The company has not made any decisions about what will happen after that, Flores said yesterday.

Yesterday's meeting at GM's Warren Technical Center was a continuation of a dialogue that General Motors has had for years with Maryland officials about the Baltimore plant, Flores said.

"We came away from the meeting clearly understanding that the entire delegation from Maryland supports Baltimore assembly and has made it very clear that they want us to maintain a presence in Maryland," said Flores, who attended the approximately 90-minute-long meeting.

"When the company decides what's going to happen to the facility beyond the summer of 2005, they want to make clear that one of the factors that's considered is the state of Maryland and the federal delegation."

Flores said there was no mention of specific incentives, such as tax breaks, to induce GM to keep the plant in Baltimore.

Melissaratos offered such concrete ideas as creating a free-trade zone in Maryland so that the company could assemble vehicles for export more cheaply.

He also asked the company to consider retrofitting the plant to make smaller numbers of what he called "boutique" vehicles, which could include alternative-fuel cars and trucks.

Yesterday's trip was "probably mostly an attempt to show concern for political purposes, to show that the city and state leaders did not idle in defending the local economy, but it's possible they could have some impact," said Matthew Crenson, a political science professor at the Johns Hopkins University.

"Big cities can still save plants. It is possible; it has happened," said Sean McAlinden, chief economist at the Center for Automotive Research in Ann Arbor, Mich. "It' s possible. It's not probable."

Upgrade expensive

The 68-year-old Baltimore plant hasn't been given a new product to manufacture since 1985, industry experts noted. It would cost millions of dollars to upgrade it to manufacture a new product.

General Motors has attempted to ease the economic pain from the plant's decline by offering rich incentives for employees to transfer to plants elsewhere and by offering jobs to Broening Highway workers at a GM Allison transmission plant that opened in White Marsh last year.

Flores said demand for the vans manufactured at Broening Highway would determine the fate of the plant.

At least one city has been able to rescue a plant after an announced closing.

Ford Motor Co. said early last year that it planned to close a manufacturing plant in Hazelwood, Mo., by mid-decade. A task force that included state and local politicians spent about 18 months getting that decision reversed.

In September, Hazelwood was kept off a list of facilities that will close, though production there will be reduced to one shift.

Some see hope

Given that, some think yesterday's Michigan trip was worthwhile.

Walter Plummer, president of UAW Local 239 in Baltimore said he thinks that if sales remain at current levels, the plant has a chance to remain open and gain a new product.

Bill Barry, director of labor studies at the Community College of Baltimore County, said he thinks political leaders would do whatever GM wanted to keep the plant open.

"The question has always been what would it take to get GM to reinvest here in the Baltimore area, bring a new product in," Barry said. "And GM has never given a real clear answer."

Sun staff writers Michael Dresser and Jamie Smith Hopkins contributed to this article.

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