General Motors Co. will bring back 600 laid-off auto workers and add equipment at two Canadian factories in an effort make more midsize crossover vehicles that have been selling well in both the U.S. and Canada.
The company announced Friday that it will add equipment and reconfigure the body-making shop at its factory in Ingersoll, Ontario, where it makes the Chevrolet Equinox and GMC Terrain crossovers.
It also will put hundreds of workers back on the clock at a factory in Oshawa, Ontario, and add equipment to the plant so it can make Equinoxes in addition to its current product, the Chevrolet Impala full-size sedan.
GM has been struggling to meet demand for the two crossovers, which are like small sport utility vehicles but built on car underpinnings. When equipped with a four-cylinder engine, the vehicles can get up to 32 mpg on the highway.
So far this year, GM has sold 17,574 Equinoxes and 8,091 Terrains. Equinox sales are up 98 percent from last year, while the Terrain is a newer vehicle and few had been built at this time last year.
Dealers have complained that they can't get enough of the vehicles because they sell as soon as they come off the truck.
Under the plan, which is scheduled to begin in October, the expanded body shop at the Ingersoll plant will crank out more Equinox bodies than the factory can use, even though it is now working around the clock.
The bodies, which are the shell of the vehicle and include the frame, will then be trucked 130 miles east to Ingersoll, near Toronto, where three shifts of workers will paint and assemble the crossovers on the same assembly line that now makes the Impala, said GM of Canada spokeswoman Jennifer Wright.
In addition to recalling the laid-off workers, GM will hire 70 new people for the Ingersoll plant, Wright said.
GM, which for years had produced more vehicles than it could sell in North America, has been leery of reopening factories to meet additional demand for some of its hotter-selling products. GM was forced to sell automobiles at big discounts due to overproduction, which led to broadening losses.
Factory overcapacity was one of the main reasons GM was forced into bankruptcy protection last year.
GM closed factories and shed debt during its stay in bankruptcy protection, and now says it has a good chance of turning a profit this year.
But Mark Reuss, GM's North American president, said in a statement that the plan for the two Canadian plants "allows us to meet customer demand for hot products while avoiding a potential production overcapacity."
GM wouldn't say how much money it is spending to add equipment at the two plants, nor would it say how many additional Equinoxes it will be able to produce when both plants are up and running.
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