GM to wind down medium-duty truck production

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General Motors announced Monday, June 8, that it has decided to wind down its medium-duty truck operations after four years of working with multiple potential buyers, including Navistar International Corp.

GM, which declared bankruptcy last week, says production of the Chevy Kodiak and GMC TopKick medium-duty trucks at the company’s plant in Flint, Mich., will cease by July 31. The factory also makes Chevrolet Silverado and GMC Sierra pickups, as well as medium-duty trucks for Isuzu Motors.

Navistar and GM announced Aug. 20, 2008, that the two companies had decided not to renew a memorandum of understanding for Navistar to purchase GM’s medium-duty truck business. The companies attributed the decision not to renew the MOU, which has expired, to “significant marketplace and economic changes.”

GM said at the time that it would continue to run the medium-duty business as it had in the past, including providing sales, service and marketing support to GM dealers for its medium-duty trucks. GM said that it would continue to review strategic options for the business, including continued discussions with Warrenville, Ill.-based Navistar.

In the original proposal announced on Dec. 20, 2007, Navistar was to acquire GM’s medium-duty truck business, including assets and intellectual property rights to manufacture GMC and Chevrolet brand vehicles in the Class 4-8 gross vehicle weight range. The deal also was to include purchase of the related service parts business. Navistar was to sell a competitive line of Chevrolet and GMC vehicles and service parts through GM’s proprietary dealer network in the United States and Canada.

Navistar would have added the GMC TopKick and Chevrolet Kodiak truck brands to its growing portfolio of brands, and there was a possibility that TopKicks and Kodiaks eventually could have been powered by International engines.

When a deal was definitively concluded, production of the vehicles would have moved from GM’s plant in Flint to an unnamed Navistar facility. GM would have retained ownership of its Flint plant and continued to build other products at the facility. GM would have continued its medium-duty truck relationship with Isuzu to market W-Series trucks through GM’s medium-duty dealer network.