New Labor Deal, Designs Mark Turnaround for GM General Motors has a new labor contract. It's making profits instead of losing money. And its new vehicles are generating some buzz: The company's new crossover sport utility vehicle is getting rave reviews, and GM is promising a next-generation hybrid for 2010.
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New Labor Deal, Designs Mark Turnaround for GM

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New Labor Deal, Designs Mark Turnaround for GM

New Labor Deal, Designs Mark Turnaround for GM

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ROBERT SIEGEL, host:

This is ALL THINGS CONSIDERED from NPR News. I'm Robert Siegel.

MELISSA BLOCK, host:

And I'm Melissa Block.

A new labor contract at Chrysler won final approval from workers over the weekend. Workers at GM also recently ratified a new contract. Both companies hope the new contracts will help them cut costs and compete with the likes of Toyota and Honda.

But to really compete, the domestic automakers have to do more than cut labor costs, they have to build vehicles that people want to buy. GM appears to be making some steps in that direction. Its won some good reviews, and fails in the past few months have started to pick up.

Dustin Dwyer of Michigan Radio has this report on how things are changing at GM.

DUSTIN DWYER: Dan Neil critiques cars for a living. He has a column in the Los Angeles Times. He's the only car critic to ever win a Pulitzer Prize. And a couple of years ago, he became GM's enemy.

Mr. DAN NEIL (Auto Critic; Columnist, Los Angeles Times): I wrote a story about the Pontiac G6, which is just an awful car.

DWYER: Neil's story was as much about the management of GM as it was about the car. And after the column ran, GM pulled all of its advertising from the L.A. Times' national edition.

Mr. NEIL: I suspected it probably had something to do with the fact that I demanded that the top executives be fired and shot out of a cannon across Lake Michigan or something like that.

DWYER: Those were not Neil's exact words in the column, but he did call for heads to roll. That year, GM went on to lose $10 billion. No heads rolled, but something did change. Neil says as GM launched its turnaround plan in 2005, it also started to improve little things in its vehicles that had annoyed so many drivers. It eliminated what Neil calls rattles and titters, and it improved the interiors of its cars and trucks. So much has changed in GM's vehicles since 2005, that a few months ago Neil declared GM his new favorite car company. He says one example of what GM is doing right is the new Crossover SUV, the Buick Enclave.

Mr. NEIL: It is the best Buick I've ever driven. It is the most artfully executed Buick interior I've seen. I think it's a very, very competitive product.

DWYER: And the Enclave is enjoying strong sales, as are its two sister vehicles, the Saturn Outlook and GMC Acadia. They're even stealing customers away from Asia-based automakers, according to one firm that analyzes industry sales. It's a point of pride for workers who build the vehicles at GM's Lansing Delta township assembly plant in Michigan. David Rude(ph) is one of those workers.

Mr. DAVID RUDE (General Motors Worker): I mean, people have had a perception about foreign cars for a long time, and they are starting to realize that American-made products here in this county are just as well build as they are in Asian countries.

DWYER: But the Enclave, the Acadia and the Outlook are more than just points of pride. Because the vehicles had been so popular, GM added workers to help meet demands. Theresa Nelson(ph) was one of them. She works in a group that bolts on the wheel wells for the three Crossovers.

Ms. THERESA NELSON (General Motors Worker): The money that I'll make here will put my kids through college. That's my goal. To pay cash and my kids to go to school. So as long as these are selling and they keep me working, and the way it looks like it's going, we're going to be making them for years. So I'm excited.

DWYER: But GM's crossovers represent a small part of GM's massive line-up of vehicles. Plenty of duds remain. And automobile writer Dan Neil says GM vehicles still have another glaring problem, fuel economy. The automaker is working on a new plug-in hybrid called the Chevy Volt that could go 40 miles without using a single drop of fuel. But that car is not expected to be in showrooms until 2010. In the meantime, Dan Neil says GM has a lot riding on the Volt.

Mr. NEIL: They have promised us a big change in a couple of years. They've got to see that through.

DWYER: If they don't, Neil could be first in line calling once again for heads to roll or for executives to be shot out of a cannon.

For NPR News, I'm Dustin Dwyer in Auburn, Michigan.

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