General Motors expects to shut down the consolidated line that employs about 2,000 workers at its Oshawa, Ontario plant by June 1, 2013. GM originally planned to close the line in 2008, but kept it running thanks to significant demand for the Chevy Equinox crossover.
The plant’s flex line will continue to build the Buick Regal, Cadillac XTS, Chevy Camaro as well as the new Impala starting next year; some of the 2,000 workers from the consolidated may be hired onto the flex line if market demand for the Impala warrants a third shift. However, the new Impala will also be built at GM’s Detroit-Hamtramck plant.
According to Scotiobank economist Carlos Gomes, the most jobs that could make their way to the flex line is about 500, resulting in approximately 1,500 lost jobs. General Motors of Canada director of communications Faye Roberts said that some employees could retire or go on indefinite layoff, making the exact amount of lost jobs difficult to determine.
The consolidated line will be shut down in three stages, with the first of the current three shifts to close by the fourth quarter of 2012; the second shift will cease in the first quarter of 2013 and the final shift will end when production of the current generation Chevrolet Impala ends, likely in June 2013.
“General Motors has made their intentions extremely clear over the last year or so, but we were hoping they would change their position,” said CAW Local 222 chief Chris Buckley.
“It’s disheartening that they’ve decided to close this plant. What’s even more disheartening is they’re not even giving us an opportunity to see if we can do something creative to attract new investment.”
Coincidentally, the current contract for CAW members at GM expires this September, with negotiations for a new three-year agreement expected to start in July. The closure of the consolidate line will be “front and center” during talks, said Buckley.
The GM Authority Take
In our opinion, General Motors is closing the consolidated line for two reasons: the first is the discontinuation of the outgoing Impala; the new 2014 model is likely built more efficiently alongside other Epsilon-based models like the Regal and XTS on the flex line. The second reason is a more efficient method of building the Chevy Equinox.
Currently, Oshawa’s consolidated line builds overflow Equinoxes from CAMI automotive, where CAMI builds un-painted Equinox bodies and moves them off the line before they reach the plant’s paint shop. The extra bodies are then trucked to Oshawa, where they get painted and finish assembly. The technique was a quick (and dirty) fix to substantial Equinox demand that GM didn’t have the capacity to meet. Once the consolidated line is shut down, the Spring Hill plant in Tennessee will become the second plant to build the Chevy Equinox, as General Motors announced in November of 2011; the move will likely result in a more efficient and less costly Equinox assembly.
As it would seem, Canadian jobs are being substituted by those in the U.S.