The News Journal from Wilmington, Delaware • Page 40

SC2 THE NEWS JOURNAL DECISION DAY How the Boxwood Road shutdown affects Delaware 1 a 1 II The News JournalCHUCK McGOWEN Day shift workers leaves GM's Boxwood Road plant Thursday after learning earlier In the day the plant will be closed In 1996. iivi.i:i.MAryHj.niu.ii,M.iiuj;k'j FRIDAY, DEC. 4. 1992 yit It's a real tip of the cap to the people at if "that plant and the quality of the work they do (the scheduled closing) is in '96 and not sooner. 33 Rich Diver, Diver Chevrolet I -Hopefully, you've got three years time, and maybe there's a chance this thing can be looked at if the economy spins around in the next twelve '''months.

33 J. Robert Woods, Newcastle County councilman hope is that in the four years before they shut their doors the economy will strengthen, demand for GM products will increase and GM's own financial situation will improve, so that they can be convinced it's more profitable to keep Boxwood operating. 33 Sen. Joseph R. Blden D-Del.

Transition exacts toll on the state By STEVE LAMBERT Business editor Delaware's auto industry has maneuvered its way through the latest round of industry cutbacks pretty banged up, but not totaled. Thursday's announcement by General Motors Corp. that it will close its Boxwood Road plant in 1996 came two weeks and a day after Chrysler Corp. revealed that it was keeping its Newark plant open by adding its popular new Dodge Intrepid to the plant's production line. Chrysler's decision, in essence, extended the life of that 36-year-old plant at least through the end TOP DELAWARE EMPLOYERS Du Pont Co.

23,000 State of Delaware 14,000 Dover Air Force Base 6,681 military, 1,421 civilian U.S. government 6,000 Medical Center of Delaware 4,035 full time, 1,092 part time MBNA America 4,454 All local governments 4,000 Chrysler Corp. 4,000 ICI Americas Inc. 3,856 University of Delaware 3,573 full time, 217 part time General Motors Corp. 3,500 Source: Jan.

Journal research 1992 News and Beretta, are showing signs of their age. Sales of the two models, introduced in 1987 and '88, are down about 20 percent from a year ago. "We're in a transition," said Ed Simon, analyst with the Delaware Corsica, Berettas GM duplications paled next to such popular models as the Honda Accord, Nissan Sen-tra and Ford Escort. The Corsica and Beretta, by comparison, "are not imaginative cars," he said. That sentiment was echoed earlier this year by Consumer Reports, which derided Corsica's performance, handling and reliability.

The June 1992 issue went so far as to call Corsica "the archetypal rental car." In fact, Chevrolet estimates sales to rental car companies accounted for 60 percent of Corsica's business. By NEIL CORNISH Staff reporter Once among the most popular cars in the country, Chevrolet's Corsica and Beretta eventually fell victim to competition foreign and internal. The problem, according to Car and Driver associate editor Martv Padgett, was the two cars competed in the same compact market as the Buick Skylark, Pontiac's Grand Am and Oldsmobile's Achieva all GM products. Ihose cars were basically a duplication of other lines," he 1 4 I UMniiiiiiiiM imuiinn mi 'mm 7 i 1 Pont connection Castle, Carper Gov. Mike Castle and Gover nor-elect Tom Carper will meet with Chrysler Corp.

executives in Detroit Dec. 16. Delaware officials have been concerned about the future of the Chrysler assembly plant in Newark and the General Motors Boxwood Road plant. Castle and Carper tried unsuccessfully to arrange meetings on the same day with both corporations in Detroit to discuss what the state could do to of the decade. Even so, it will not be as healthy as it once was.

Chrysler will spend $137 million to refit the plant, including a addition. However, the factory's output will be trimmed by as much as 25 percent, meaning an unspecified said. "It's not that the products were not making money. It's just tnat the products were similar in the GM lineup, and these can be replaced quickly." The Corsica and Beretta are basically the same car; the Corsica having four doors and the Beretta two. Both cars sold for about $11,500, although with options the Beretta's price could climb as high as $16,000.

Chevrolet introduced the cars in 1987. But sales have plummeted 50 percent since reaching a high of 355,323 cars in 1988. The line has averaged a 20 percent drop in Castle and Career nrpnnmd for a meeting this past Tuesday with GM executives in Detroit a last-ditch effort by the officials to pledge their support for the plant by getting ideas from local plant officials for the best arguments to be made for keeping the plant open. Although GM has been attempting to play down what states might do to save a local plant, Carper said, "I left the meeting with Boxwood plant managers believing we had a very good shot." But when Castle and Carper took their pitch to Detroit, the vibes weren't good. "This wasn't the normal competitive situation," said Castle, in which plants vie against each other.

"The GM executives didn't want to hear about incentives from us. I'm convinced they knew what the decision was when they saw us in Detroit. We did not come away from that with a great deal of confidence." Although their instincts were correct, Castle and Carper said they are determined to use the next 3Va years to persuade GM to reverse the decision. A lot of things can change, Castle said. Division of Labor.

"During the '70s, the automakers employed close to 10,000 in Delaware. It's been falling ever since, but you get a blow like this, and it makes you realize how important thev are. Indeed, the auto industry directly and indirectly accounts for about 4.2 percent of Delaware's labor force. That's an economic force that's often overlooked in a state better known for its banks and chemical companies. The GM plant closing alone could add a percentage point to the state's relatively low unemployment rate, Simon said.

In October, 5.3 percent of Delaware's labor force was out of work; the U.S. average was 7.4 percent. "I'm not going to minimize the impact," Simon said. "When you lose these kinds of jobs, they're very, very difficult to replace." CorsicaBeretta production 181,782 1986 1988 1990 1992 '19B6 1992 thru Dec. Source: Automotive News Delaware Historical Society photo Groundbreaking, Aug.

28, 1945: (From left) Gov. Walter M. Bacon, Wilmington Mayor Thomas Herlihy, plant manager Robert Ahlers, GM Vice President L.C. Goad (with shovel) and Chamber of Commerce official Gerrish Galloway. Boxwood Road plant's 36th.

"We're just hoping we can stay around another 36," a local union official says. 1 984 Retool to build Olds Delta 88; last of 2.2 million Chevettes rolls off line. Stalled contract talks spark a six-day walkout by 4,000 United Auto Worker members. 1986 Production stops Feb. 5, 4,800 workers idled, as a $311 million rebuild puts in robot welders to make cars Corsica and Beretta.

Workers are retrained at Delaware Technical Community College as part of a $16 million program. The first car drives off the line Oct. 6. Assembly stops so all employees can watch. Plant employment hits 5,200.

1989 Slow sales force the plant to cut 450 of 4,100 workers, the first such layoff in 10 years. 1991 The Wilmington plant builds its 7 millionth vehicle, a white Beretta, May 1. GM stops making cars at its Linden, N.J., plant, shifting the work to Delaware. 1992 Boxwood Road escapes the ax in an early round of GM plant closings in February. Plant builds its 1 milliontjj car.

1J i I Linden, plant iooi 1 closes: consolidates at Boxwood Rd. eye Chrysler meet keep the plants. They made their pitch to save the Boxwood plant to GM officials Tuesday, although GM said there was nothing they could do. Two weeks ago, Chrysler ended concerns about the plant by announcing it will build the new Dodge Intrepid at Newark. That has turned the visit with Chrysler executives into more of a routine visit.

Nancy Kesler number of layoffs. The Newark plant currently builds the Chrysler LeBaron and the Dodge Spirit and Plymouth Acclaim. Although LeBaron remains a popular seller, Spirt and Acclaim, like Boxwood's Corsica sales each year since 1989. "This just happened to be a very competitive segment," said Chevrolet spokeswoman Arlene Reindel. "They were real hot when they first came out." Reindel dismissed statements that GM's Saturn originally introduced to compete with foreign imports also cut into Corsica's sales.

"That's been talked about, that we've cannibalized ourselves," she said. But she said in-house surveys showed the cars appealed to different buyers. Yet Padgett said the two cars The Du By RICK RABER Staff reporter General Motors' roots in Delaware run far deeper than concrete and steel. For almost half a century, the Du Pont Co. wielded a controlling interest about 23 percent of the stock in GM.

Du Pont was so intimately involved with the automaker that GM for many years held its annual meetings in Boxwood Road's huge cafeteria. Stockholders who couldn't fit into the plant sat outside under tents, listening to the event on loudspeakers. But that all changed in 1965, after Du Pont divested its GM holdings. That was prompted by a 1961 U.S. Supreme Court decision that said Du Pont's owner-supplier relationship with GM violated antitrust laws.

Du Pont's courtship with GM began during World War I when Du Pont found itself flush with cash from its sales of explosives and other war-related products. Pierre S. du Pont, whose company was already making products used in cars, saw GM as a promising investment. Du Pont was an admirer of William C. Durant, the GM founder, and his vision of a booming future for the motorcar.

Pierre du Pont began making personal investments in GM in 1914. And the Du Pont Co. bought its chunk of GM between 1917 and 1919, when GM was in financial trouble and needed a boost. With the infusion of cash, GM began to roll again. The financial stake brought more than an advisory role: Pierre du Pont served as chairman of GM from 1915 to 1929 and president from 1920 to 1923.

GM, which was originally organized as a New Jersey corporation in 1908, was reorganized under Delaware law during du Pont's command. Though Du Pont has long since abandoned its direct investment in cars, the industry is still its biggest customer. The company's wide array of auto products everything from fuel to lubricants to plastics accounts or more than $3 billion of Du Ptt sales. Ii. ilia The News JournalBOB HERBERT Governor-elect Carper (left) and Gov.

Castle discuss GM's news. Castle, Carper make unsuccessful GM plea 1945 General Motors Corp. plans new factories to meet postwar demand. Ten years of pleas by Wilmington Chamber of Commerce pay off when GM decides to build at Boxwood Road. The Du Pont Co.

owns 23 percent of GM's stock. 1946 Plant built on 185 acres for $9.5 million. 1947 Eight black Pontiac Streamliners are first to roll off the line Oct. 6. With 800 employees, the plant builds 40 Streamliners and Oldsmobile Dynamic Cruisers per hour.

1948 The plant's 1,700 employees pump an estimated $10 million yearly into the local economy. In the next 15 years, the plant builds the Pontiac Bonneville and Grand Prix, the Olds 88, the Buick LeSabre and others. Boxwood Road hosts GM's annual stockholders meeting, each spring through 1964. 1950 Work force reaches 2,800. Chrysler sells 48 acres to a developer, to ease housing shortage for employees.

1952 Work force at 2,200. 1955 Plant adds second shift. 4,400 workers build 60 cars per hour. 1 957 U.S. Supreme Court antitrust ruling orders the Du Pont Co.

to sell holdings in GM. 1964 Plant begins building Chev-rolets Impala, Caprice, Bel Air as well as Buicks. Plant produces a record 190,000 cars, contributes $69 million to the state economy. 1 965 Work force reaches 4,300. Du Pont divests the last of its GM stock.

The automaker shifts stockholder meetings from Boxwood Road to Detroit. 1971 3 millionth car is built at Boxwood Road a Chevrolet. 1973 The plant lays off half of its 4,300 workers as part of company-wide cutbacks. Energy crisis ends Buick production. 1975 Plant retools for Chevrolet Chevette, GM's first small car.

Boxwood Road builds 70 Chev-ettes per hour until 1984. 1980 Employment at the plant exceeds 4,700. 1983 GM marks its 7th year, the I -We need to sit down with the state govern- ment and other lead- and discuss how to make this facility appealing. The bottom line is we think we have a good work force here and Box- is a good plant. 33 I Dennis E.

Greenhouse, New Castle County Executive --My hope, and I have '-no informed basis to say this, is that when the economy recovers they may reconsider and retool the plant and build another GM product, or find another car company interested it. 33 Wilmington Mayor Dan Frawley. '--Today's announcement by the company that it is ceasing operations at the Boxwood plant after the 1996 model year confirms 'our worst fears. 33 Sen. William V.

Roth Jr, R-DeL By NANCY KESLER Dover Bureau chief WILMINGTON As GM struggled financially, Gov. Mike Castle said he did everything he could think of to ensure the Boxwood Road plant stayed open and the $20 million in annual revenues it generates remained in Delaware. It didn't work. But it is little consolation that Thursday's GM decision to close the plant in mid-1996 will come during the term of Governor-elect Tom Carper. At a news conference Thursday with Carper, Castle said he had thought Boxwood would be spared the ax because of all the work that had been done to improve plant performance.

The state has helped initiate a "just-in-time" supplier program to reduce costs and provide training to workers at Delaware Technical Community College. State environmental officials also have helped plant management develop innovative ways to comply with pollution control regulations. Relations were good between the state, plant management and the work force. "GM never had a problem here," Castle said..