General Motors to Invest in Spring Hill and Bedford Plants

Zacks

General Motors Co. (GM) announced plans of a $185 million investment at the Spring Hill manufacturing complex, Tennessee to manufacture small gas engines. This investment will also help the company retain 390 positions.

Further, General Motors plans an additional $48.4 million investment in the Bedford, IN powertrain castings plant, creating or retaining 45 jobs. These investments will support the manufacture of the new small displacement engine of the automaker. Interestingly, Spring Hill is one of the six manufacturing locations around the globe that will be manufacturing the engine. This new small displacement engine is part of the all-new Ecotec engine family, which will be used by five of General Motors’ brands in 27 vehicles of model year 2017.

General Motors’ Ecotec portfolio consists of 11 engines with variations of three to four different cylinders ranging from 1.0L to 1.5L and includes some turbocharged versions as well. These engines boast power ratings ranging from 75 (56 kW) to 165 horsepower (123 kW). Meanwhile, the torque ranges from 70 lb-ft (95 Nm) to 184 lb-ft (250 Nm). Importantly, Ecotec engines are the most advanced and efficient small displacement gasoline engines currently available.

Notably, the Spring Hill plant produces the Ecotec 2.0L turbocharged direct injection 4-cylinder engine, the Ecotec 2.4L direct injection 4-cylinder engine and the Ecotec 2.5L direct injection engine. These engines feature in the 2014 Chevrolet Malibu and Chevrolet Impala. Meanwhile, the Bedford plant produces transmission casings, converter housings and small gas engine blocks.

General Motors also announced that it intends to produce the next-generation Cadillac SRX at the Spring Hill plant. Cadillac SRX was initially produced in Mexico, but the company later shifted the production to Spring Hill owing to conflicts between the United Auto Workers leaders and Tennessee Republicans. It is to be noted in this regard that the Spring Hill unit was established on the outskirts of Nashville in 1990 and used to primarily produce the now-obsolete Saturn brand’s vehicles.

General Motors had earlier announced that it will be spending around $350 million in the Spring Hill plant for manufacturing two mid-size vehicles. Though one of the vehicles has been recognized to be the Cadillac SRX, the other is yet to be decided by the automaker. With this, the company will be creating or retaining approximately 1,800 jobs.

General Motors currently carries a Zacks Rank #3 (Hold). Better-ranked automobile stocks worth considering include Visteon Corp (VC), Tesla Motors, Inc. (TSLA) and Fox Factory Holding Corp (FOXF). Tesla and Visteon sport a Zacks Rank #1 (Strong Buy) while Fox Factory carries a Zacks Rank #2 (Buy).
 

Read the Full Research Report on GM
Read the Full Research Report on VC
Read the Full Research Report on TSLA
Read the Full Research Report on FOXF


Zacks Investment Research

View Comments (2)