G. Chambers Williams III: GM seeks small success with Sonic

General Motors this past week began production of the 2012 Chevrolet Sonic subcompact car at a newly remodeled factory in Orion Township, Mich., where the compact Buick Verano also will be assembled.

Chevrolet's all-new Sonic will begin arriving at dealerships within the next few weeks, a bold experiment by GM to manufacture a small car in the United States, rather than importing it as it has done in the past — and as all other automakers do now.

With a starting price of $14,495 for the sedan and $15,395 for the hatchback, the Sonic will compete against such entries as the Ford Fiesta, Nissan Versa and Fiat 500, which are all made in Mexico. Other competitors include the Toyota Yaris and Honda Fit, both made in Japan.

The Sonic replaces the South Korea-built Aveo in the Chevy lineup, and was developed in that country. It still is being built there, under the Aveo name. The new Aveo model already is on sale in 30 countries.

It was given a new name for the U.S. market because its predecessor wasn't highly regarded here, and the Sonic is a completely different vehicle. The original Aveo came from GM's Daewoo division, the result of the U.S. company's takeover of the former South Korean automaker in 2001.

Building the Sonic in suburban Detroit is a gamble because domestic automakers never have been able to produce affordable small cars in the United States, largely because of more expensive United Auto Workers labor.

But the union struck a unique deal with GM to get the Sonic in job-starved Michigan, allowing the automaker to pay line workers about $14 an hour instead of the $28 they get at other GM, Ford and Chrysler plants. That was the only way GM would have been able to produce the car in the United States at a profit, and the UAW was desperate for the jobs.

The union already had agreed to a new two-tiered wage system four years ago that allowed new workers to be hired at the $14 rate — which is what Volkswagen is paying its starting assembly workers at its new plant in Chattanooga, Tenn., which makes the all-new Passat midsize sedan. But until now, the $14 rate was not paid to assembly-line workers, instead it was reserved for nonassembly positions in the plants.

There are 1,750 workers at the Orion plant, GM said, including 1,600 hourly who are UAW members.

GM also pumped $545 million into the Michigan economy to rework the Orion plant to build the Sonic and the coming Verano, which will be Buick's smallest and least expensive model. The Verano is based on the same architecture as the new compact Chevrolet Cruze.

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