For Detroit, 2009 a tough grind back into gear

Last year at this time, Motor City was anxiously awaiting word on whether the US government would rescue automakers devastated by steep recession and years of short-sighted management.

The outgoing administration did come up with 19 billion dollars to keep General Motors and Chrysler afloat but both companies were eventually forced to file for bankruptcy as did more than 40 major suppliers, according to the Original Equipment Suppliers Association in Troy, Michigan.

Yet despite a year of dizzying problems and the deeply depressing 15 percent unemployment rate in the Detroit area, the mood is beginning to improve.

"I think the worst of it is behind us," said United Auto Workers President Ron Gettelfinger, who watched closely as the disaster around Detroit unfolded over the past year.

"I think things are going to get better. The economy is showing signs of improving and that will help," he said after a UAW press conference last week.

Ford Motor Co's chief executive officer Alan Mulally, noted Ford, which was lumped in with GM and Chrysler a year ago, has succeeded in using the crisis to set itself apart from the competition.

"We're still very cautious. But we had a good year," said Mulally, who noted Ford did not have to ask for federal help since it mortgaged the company in 2006 and had cash to ride out the recession. "Everyone is focused on the economy and if things start to improve, we'll be able to expand production very quickly," Mulally said as he showed off a Ford plant in Wayne, Michigan which is being converted from building truck and sport utility vehicles to building small cars.

"The good thing is we never stopped spending money on products," Mulally said.

Gettelfinger also said that while all three companies have cut their payrolls in recent years, he expects carmakers to begin adding employees as the economy recovers.

"I think these companies will be in a position where they can start hiring again," he said.

GM vice president of strategic planning Jon Lauckner, said GM plans to open a new battery plant south of Detroit in January and will open for testing of the assembly line for the highly touted Chevrolet Volt in March.

AFP