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Steve Chiotakis: Seems like the state of Michigan’s been hammered lately. Two of three carmakers got to know bankruptcy really well. And it’s unemployment rate is the highest in the nation. Well there’s this morsel: General Motors is expected to announce this morning: General Motors is expected to announce that it’s selected a Pontiac plant in Orion township, Mich. for the production of a new subcompact car. Marketplace’s Jeremy Hobson reports.
Jeremy Hobson: The Orion plant was in competition with factories in Wisconsin and Tennessee. A high-stakes competition at that, according to auto industry analyst Dave Sedgwick:
Dave Sedgwick: An assembly plant for any region is a tremendous boost for the economy. Because you’re not just creating jobs in the assembly plant itself — it creates jobs among the suppliers.
Suppliers who will have to locate just a few hours drive away. Better yet, Sedgwick says, once the economy rebounds and fuel prices head back up, a plant making subcompacts will be in a strong position. He says just look what happened when gas prices breached $3.50 a gallon last year.
Sedgwick: Sales of big trucks completely collapsed, and sales of small cars skyrocketed.
Sedgwick says for the moment, the plant will do more job saving than job creating in a state with an unemployment above 14 percent.
In New York, I’m Jeremy Hobson for Marketplace.
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