Ontario takes the hit as GM looks to the future

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Canadians have been enthusiastic partners with the Detroit-based automobile industry for well over a century, providing innovation, financial capital, government support and labour.

Companies like the Ford Motor Company originally established operations in Windsor to gain access to the Canadian market and the British Empire. Other companies followed, including General Motors and Chrysler. Others, like Hudson, Packard, Studebaker and American Motors, eventually established manufacturing facilities as well. Indeed, Hudson cars were once built in Tilbury.

But the largest industrial footprint in Ontario was by far GM’s, which over the last century has operated at various times in Windsor, Ingersoll, Oshawa and St. Catharines. The jewel in the GM Canada crown has always been Oshawa, were upwards of 40,000 people were once employed.

And so news that GM will close its Oshawa operations is disheartening on several levels. Approximately 2,500 people will lose their jobs at the end of 2019, but also GM’s century-old relationship with that city and with Ontario will be severed. GM will still build vehicles at its Cami plant at Ingersoll, and still manufacture engines and transmissions in St. Catharines, but its presence in Ontario will be substantially reduced. Ontario will be poorer for it, but so will General Motors.


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GM’s problem is the same problem facing the auto industry. It finds itself on the edge of great change as the industry begins to shift from traditional vehicles to vehicles that are self-driving and/or electric.

Paradoxically, however, GM is selling a lot of large pickup trucks along with SUVs and crossover vehicles. The traditional sedan on which the company’s fortunes were built has fallen out of favour with the public. Oshawa builds such sedans for GM, as does the four other plants in the U.S. that are also to be closed.

That’s not to say Oshawa can’t be part of GM’s future. Indeed, it should be part of General Motor’s future.

But there is another factor in play, and that’s President Donald Trump’s tariffs and his overt nationalism. One analyst suggests the steel tariff alone is costing GM Canada as much as $1 billion a year.

But the cost of Trump’s nationalism? That’s more difficult to calculate. Yet the president’s threats were enough for Ford to stop building a plant in Mexico in 2017, and it’s quite possible that GM, when planning its future, was careful to consider Trump’s response should the Oshawa plant be allowed to survive.

Trump and his tariffs, as well as slumping sales and a future yet to be clearly defined, have been enough to doom GM’s once-formidable presence in Ontario.

– Peter Epp

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