The rising demand for large SUVs and pickup trucks has instigated General Motors' (GM) long-term decision to continue purchasing raw metal for their flagship cars' framework, like that of the Chevrolet Colorado and GMC Canyon. In 2021, GM claimed to have invested US$46.5 million to enhance its Parma Metal Center for increased aluminium-related activities.
Addressing a quarterly earning call for the period ending on January 31, General Motors declared a major profit influx, resulting in a 13% stock hike for the company's shares.
The GM Parma Metal Center Plant Director, Jim Gaeschke, referred to the sources by saying: "We were a key contributor to those record-earning profits. Our customers who sit in the front seats of the GMC Canyon and Chevrolet Colorado, this part right here is where that seat attaches to."
It has been reported that with the US$46.5 million investment, GM has upgraded its press plant and metal assembly area in the Parma Metal Center, bestowing special preference to the aluminium operations.
Gaeschke proudly mentioned: "We have brand new technology here. Getting new [equipment] to support those brand new trucks is a game changer for us here in Parma."
The Parma Metal Center practically produces precision parts for full-size SUVs, medium SUVs, crossover vehicles and midsize trucks. The establishment rolls out steel and aluminium components customised to the users' request.
"There's a huge shift from the smaller vehicles and cars to that segment," Gaeschke explained.
Car components completed at the Parma plant are usually transferred to GM's Wentzville plant in Missouri for quick assembly and dispatch. The plant has been plotting to manifest an employee attendance of over a thousand heads in the upcoming few years, making the company the city's second-largest portal for job opportunities. The Mayor of Parma, Tim DeGeeter, also spoke about an investment of more than $93 million in taxable wages.
The Mayor explained: "For Parma, it's a grand slam. That plant is a lifeline to what we can do here at city hall, providing services and being a safe community here in Parma."
Founded in 1948, the GM Parma Metal Center is now celebrating its 75th year of smooth operations. A total investment of US$300 million has been made in the past decade to modernise the plant's operations.
Michael Patterson, the UAW Local 1005 Shop Chairman, denotes a major portion of the investment is being directed towards enhancing the aluminium parts producing department. Aluminium is much lighter than steel, about one-third of its weight; thus, it is a preferable metal in the construction of lightweight EV components and cars.
Patterson further pointed out: "We'll be positioned to do lightweight parts in order to increase fuel mileage and battery mileage as the business is changing. A gallon of gas is not getting any cheaper. The more we can make our products get better gas mileage, the better. Aluminum is going to play a big role in the EV market, as well as the large and midsize crossover market and the large-sized truck market."
These aluminium-related upgrades are scheduled to be completed by spring 2024.
"It gives us that extra flexibility and diversity in our portfolio to continue to move forward and bring in new work here at Parma," Gaeschke concluded.
According to sources, it can be predicted that pickup truck sales will increase by 30% over the next seven years.
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