City of Flint grants multi-million dollar tax break for GM engine plant

General Motors has been granted a multi-million dollar tax break by the officials of the Flint city council in Michigan in order to build a new engine manufacturing facility for the upcoming Chevrolet Volt plug-in hybrid. The new facility, slated to start production in early 2010, will build the 1.4L turbo engines for both the Volt and the recently unveiled Chevrolet Cruze compact sedan (pictured).

The new plant will create around 300 new jobs in the city of Flint, but this number may not be significant enough to placate residents who feel that GM's recent spate of layoffs and the subsequent effect on the city's economy has made the tax breaks unwarranted. Councilman Jim Ananich of the Flint City Council stated that the city must help GM to stay competitive, despite its recent economic problems, reports The Detroit News.

The Detroit carmaker is also seeking tax breaks from the state, and the U.S. Congress is also considering introducing tax incentives for plug-in hybrids that would lower the purchase cost of the Volt for consumers. Boosting consumer interest in more expensive but more frugal vehicles such as the Volt through tax incentives could prove to be a deciding factor in the Volt's success.