With General Motors’ impending negotiations with the United Automobile Workers union later this year, coupled with the comparative expense of manufacturing in Canada, the automaker has decided to wait until 2016 before announcing any new cars that might be delegated to its plant in Oshawa, Ontario.
Since the plant is scheduled to lose the Chevrolet Camaro later this year, analysts fear that the plant may be at risk for closure soon.
This story comes to us from The Detroit News, who also cite the available capacity in existing American plants, and the $3.6 billion investment planned for manufacturing in Mexico over the next 4 years, as other causes for concern. But so far, that decision has yet to be made. GM Canada President Stephen Carlisle said in a statement that General Motors is committed to Canada.
Said Mr. Carlisle in a statement: “We are going to be careful and are not expecting to be deciding on any major new mandates or investments in Oshawa until well into 2016.” That’s largely because GM still has to complete negotiations with Canada’s own auto workers union, Unifor.
But officials from the union, as well as some Canadian public officials, are refusing to be strung along. They are pushing to keep the plant humming into the foreseeable future, and insisting that GM make a decision on the matter sooner rather than later. Unifor President Jerry Dias said that “it’s about time they made a longer-term commitment here.”
On Oshawa’s side is the devaluation of the Canadian dollar since GM first reinvigorated the plant in 2009/2010; at 80 cents on the dollar, Dias says that production in Canada is now cheaper than in the US. Also on Oshawa’s side is that the governments of Ontario and Canada contributed approximately $10 billion to the automaker’s bailout in 2009, in exchange for concessions like keeping at least 16 percent of its production in Ontario through 2016.
Granted, General Motors will have met or exceeded that requirement regardless of whether the plant is closed after 2016. The automaker has said that the one-shift line which currently produces the Chevrolet Equinox and Impala Limited will most likely end in 2016. The second, three-shift line, which produces the Camaro and three other GM vehicles, is scheduled to lose the Camaro to the Lansing Grand River Plant later on in the year.