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GENERAL MOTORS ENDS SEARCH FOR A STRATEGIC PARTNER FOR ITS LOCOMOTIVE GROUP

 DETROIT, Oct. 26 /PRNewswire/ -- General Motors Corporation (NYSE: GM) announced today that it has called off its search for a strategic partner for the General Motors Locomotive Group, which includes Electro-Motive Division (EMD), LaGrange, Ill., and Diesel Division, London, Ontario, Canada. The Locomotive Group is a major manufacturer of locomotives and defense-related products in the U.S. and Canada.
 William E. Hoglund, executive vice president in charge of Corporate Affairs and Staff Support, said the General Motors Locomotive Group will remain a key business within the corporation with specific responsibilities for the manufacturing and servicing of freight and passenger locomotives, diesel power products and defense vehicles for world markets.
 "We have been considering ceasing our search for a Locomotive Group partner for some time. With the cooperative support recently committed by our unions, we will now move forward under the GM umbrella and continue to be competitive leaders in both the locomotive and light armored vehicle world markets," said Mr. Hoglund.
 The search for a strategic partner has been intensive and has attracted the interest of several prospective partners. In the final analysis, no potential partner was able to offer the kind of technologies, investment and market access that would have clearly enhanced the Locomotive Group's products and services.
 Mr. Hoglund said a great deal has happened inside the Locomotive Group since the search for a strategic partner was first announced in June, 1991. Specifically, "EMD and its partner, Siemens, have had a very substantial impact in the marketplace with the introduction of their new AC traction technology. This led to the recent announcement of the largest locomotive contract in railroad history for 350 new generation AC technology locomotives for the Burlington Northern Railroad, a contract that will be filled over the next few years. GM is also enthusiastic with the similar success scored by Diesel Division's Defense Operations in securing new business.
 "GM believes strongly that the high expectations it has for this business will not be realized unless the Locomotive Group is allowed to clearly focus on its business objectives without the uncertainties imposed by the search for a partner. The Locomotive Group is a successful business with important work to do. The important thing now is to let it get on with that work," said Mr. Hoglund.
 The General Motors Locomotive Group currently has 5,000 hourly and salaried employees. Electro-Motive Division manufactures diesel- electric locomotives, diesel engines and related components. Diesel Division, General Motors of Canada Limited, manufactures diesel-electric locomotives, locomotive components and light armored vehicles (LAVs).
 -0- 10/26/93
 /CONTACT: John Gable of Electro-Motive Division, 708-387-5696/
 (GM)


CO: General Motors Corporation; General Motors Locomotive Group;
 Electro-Motive Division; Diesel Division ST: Michigan, Illinois, Ontario IN: AUT SU:


SM -- DE017 -- 6856 10/26/93 11:30 EDT
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Publication:PR Newswire
Date:Oct 26, 1993
Words:461
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