Home Business General Motors invests $100 million in two U.S. plants to boost transmission production

General Motors invests $100 million in two U.S. plants to boost transmission production

GM extending plant shutdowns at three car and crossover plants due to chip shortage

General Motors employees work on the assembly line Friday, April 26, 2019 at Fairfax Assembly & Stamping Plant in Kansas City, Kansas. The Fairfax facility produces the Cadillac XT4 and Chevrolet Malibu.

Jim Barcus for GM

General Motors announced on Thursday that it will invest $100 million in two of its U.S.-based manufacturing plants to boost production of 10-speed automatic transmissions found in two of its popular pickups.

The company is allocating $93 million for its plant in Romulus, Michigan, that will increase “machining capability,” according to a statement. General Motors is also investing $7 million in a Bedford, Indiana, plant for increased die casting metal capabilities.

The investments are intended to boost production of the transmissions used for its Chevrolet Silverado and GMC Sierra light-duty pickups, the company said.

“Demand for our Chevrolet Silverado and GMC Sierra full-size pickups continues to be very strong and we are taking action to increase the availability of our trucks for our dealers and customers,” Phil Kienle, vice president of GM North American Manufacturing and Labor Relations, said in a release. 

The plant in Michigan builds V-6 engines and 10-speed transmissions for GM’s Chevrolet, Buick, GMC and Cadillac vehicles, the company said, while the Indiana aluminum die casting facility produces transmission casings, converter housings, heads, and small gas engine blocks.

The investments come amid temporary shutdowns at three of General Motor’s assembly plants through mid-March due to a global shortage of semiconductor chips. The closures are intended to ensure the company has enough chips to produce its more profitable pickup trucks and SUVs.

Global automakers are expected to lose some $60 billion in sales this year due to the shortage. The chips are used for areas ranging from infotainment systems to more traditional parts such as power steering. They’re also used in consumer electronics.

The impacted plants are in Kansas; Ontario, Canada; and San Luis Potosí, Mexico. They produce the Chevrolet Malibu sedan and Buick Encore, Cadillac XT4, GMC Terrain, and Chevy Equinox and Trax crossovers.

— CNBC’s Mike Wayland contributed to this report.

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