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GM to invest in better m.p.g.

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GM to invest in better m.p.g.

V8 improvements to keep or create 1,600 jobs



General Motors said it will invest about $890 million at five factories to make its V8 engines more fuel efficient, preserving or creating roughly 1,600 jobs.

The automaker announced the investments Tuesday at factories in Bay City; Tonawanda, N.Y.; St. Catherines, Ontario; Bedford, Ind., and Defiance, Ohio.

The spending, which has been in the works for a long time, will help GM meet government fuel economy standards that become fully effective in 2016.

"These latest investments show our commitment to improving fuel economy for buyers of every GM car, truck and crossover," said Mark Reuss, president of GM North America.

The investments will help the company boost the fuel efficiency of its pickup trucks, SUVs and high-performance cars, said GM spokesman Tom Wilkinson.

The new engines will have aluminum blocks, which are up to 100 pounds lighter than the current cast-iron ones on some GM V8s, and more efficient technology that injects fuel directly into the combustion chambers. The engines also will be able to run on E85 fuel.

Factories in Tonawanda and St. Catherines are to make the next-generation V8 engines, while the other plants will make engine components.

GM said it will invest $400 million in the Tonawanda plant, keeping 710 jobs, while it plans to put $235 million into the Ontario plant, securing about 400 jobs.

The Bay City parts factory will see a $32-million investment, keeping more than 80 jobs.

The Defiance foundry, which makes engine blocks, is to get $115 million to save up to 189 jobs, while 245 jobs at the Bedford parts plant are to be secured with a $111-million investment. GM spokeswoman Kim Carpenter said the company has not determined yet how many of the 1,600 jobs will be new.

Any new jobs likely would be filled by people from a pool of about 4,200 laid-off workers.

Last week, GM said it would invest $257 million in its Kansas City, Kan. and Detroit plants to tool them for the next Chevrolet Malibu.

GM would not give details of the fuel economy improvements or the new engines announced Tuesday.

GM said in a statement that it has invested more than $2.3 billion at 22 U.S. and Canadian factories since it emerged from bankruptcy protection last July, restoring or creating more than 9,100 jobs.

Much of Tuesday's announcement, though, has been planned for years and is part of the normal course of GM's business. Auto companies routinely spend millions of dollars to update plants as new vehicles are rolled out.

Federal corporate fuel economy standards call for a 35.5 m.p.g. fleet average within six years, up nearly 10 m.p.g. from the current standards.

Each auto company will have a different fuel-efficiency target, based on its truck-car mix. Automakers that build more small cars will have a higher target than companies with a range of cars and trucks.

GM's passenger cars will have to hit 32.7 m.p.g. in 2012 and increase to 36.9 m.p.g. by 2016. Honda, meanwhile, will need to reach passenger car targets of 33.8 m.p.g. in 2012 and 38.3 m.p.g. in 2016.



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