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GM to close Janesville plant; state wants money back

General Motors said Tuesday it will close its 89-year-old SUV plant in Janesville by 2010, and there are no plans to have any other vehicles built there.

The announcement is more than an economic blow to the southern Wisconsin community which has long identified itself with car making.

The sprawling factory survived the Great Depression, World War II and major auto layoffs in the 1980s.

But it won't survive the $4-a-gallon gas prices that have motorists shying away from the SUVs Janesville has produced in recent years.

Tuesday's announcement came just before GM's annual stockholders' meeting in Wilmington. Del.

Chief Executive Officer Rick Wagoner says the consumer move to smaller cars will be permanent.

He said Janesville will stop producing medium-duty trucks by the end of 2009.

And they'll stop making SUVs in 2010, or sooner if the market warrants.

Janesville is one of four truck and SUV plants to close in just the latest round of GM restructuring. Wagoner also said the Hummer may be discontinued.

The closings are designed to save $1 billion a year starting in 2010.

Janesville has 2,600 employees, and it's already losing 750 in July when one of its two shifts was scheduled to shut down. It was only three years ago when the plant employed 4,000 people.

Want money back

State officials want to know if they can get back any of the $10 million they gave to the General Motors plant in Janesville four years ago.

Lee Sensenbrenner of Gov. Jim Doyle's office said GM has spent $9.3 million of the grant.

Wisconsin taxpayers put up the money in 2004, to help GM with a $175 million upgrade.

Those grants required the plant to keep at least 3,300 workers through 2010. But Janesville now has just 2,600.

Today, the company said it was closing the massive facility by 2010.

Sensenbrenner says the terms of the 2004 deal are being reviewed to see what taxpayers can get back.

Doyle is scheduled to meet with Janesville workers this afternoon.

Janesville made the high-profit SUVs which have since gone out of favor, thanks to $4 gasoline.

It already planned to close one of its two production lines in July, putting 750 people out of work.