GM plant closings rip holes in communities

updated 7:55 a.m. ET June 4, 2008

MORAINE, Ohio - The General Motors Corp. plant in this Dayton suburb is a forest of smokestacks that form the nerve center of this industrial community built along the banks of the Great Miami River.

Each day, about 2,400 workers file inside to assemble the GMC Envoy, Chevrolet Trailblazer, Saab 9-7X and Isuzu Ascender sport utility vehicles.

But some time before the summer of 2010, the Moraine plant will be no more: It is one of four that GM announced Tuesday it will close. And there are fears here that the people — and the city’s fortunes — will disappear with it.

The loss of the SUV plant will leave behind a bleak landscape for the surrounding community, an area scarred by a dwindling population, high poverty rates and one of the nation’s hardest-hit pockets of the housing slump.

“It’s going to be a ghost town,” said Debbie Miller, 52, who owns The Upper Deck, a restaurant and bar next to the plant. “There are no jobs here. I don’t know what they’re going to do.”

The plant closings are casualties of surging fuel prices that are hastening a dramatic shift to smaller vehicles. About 8,350 jobs at the four plants — here, in Janesville, Wis., and in Canada and Mexico — will be lost.

“There are going to be a lot of houses for sale,” said Miller, born and raised in the area. “We’ll see people leave this area. This is a dying town.”

Once, the Dayton area was dotted with so many auto factories that it came to be likened to a small-scale Detroit.

Delphi Corp., an auto supplier trying to emerge from Chapter 11 bankruptcy protection, has five plants in the area, all already hit by layoffs or buyouts. GM also operates a separate engine plant here that employs about 1,000 people.

But the plant closure nearly marks the end of GM’s dominance in a town that once housed five of the auto maker’s presidents in the late 1960s, said John Heitmann, a history professor at University of Dayton.

“Next to Detroit and Flint, this was number three,” Heitmann said of the Dayton area. “That’s a lot of power. This was a great GM town.”

Heitmann said he had thought the area’s skilled labor pool and favorable geography would entice the automaker to keep the plant open, but its future was ultimately doomed by what he called an outmoded product — the fuel-guzzling SUV.

“The future of Dayton is certainly not in the auto industry anymore,” Heitmann said of the number of jobs in the region’s auto production and auto parts industries. “We’re kind of an historical relic.”

The commercial strip in this town of 6,700 people is dominated by fast-food restaurants, transmission shops and office buildings with “for lease” signs tacked in front.

Community services that are already struggling, like groceries, will probably face more strain now, said Rhine McLin, the mayor of next-door Dayton, where the poverty rate of nearly 30 percent is more than twice the state average.

“There’s no way you can sugarcoat that,” McLin said. “We’re already in a recession, and it’s difficult, and this just adds to it.”

The outlook is brighter in Janesville, a city of about 63,000 near Milwaukee that has diversified and no longer counts GM as its biggest employer. But the plant closure will still sting.

“It’s going to have a devastating effect, but not as bad as if GM had pulled the plug 20 or 30 years ago,” said Gary Green, professor of rural sociology and director of the Center for Community and Economic Development at the University of Wisconsin-Madison.

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