GM will close a Canadian factory, but it's only the beginning

Tom Krisher and Rob Gillies, Associate Press Editors

Update

5.39 am PST, Monday 26 November 2018

DETROIT (AP) – General Motors is closing a Canadian plant at a price of nearly 2,500 jobs, but this is apparently only part of a much larger, more comprehensive restructuring that will be announced starting Monday.

A person informed about this told the Associated Press that the plant being shut down in Canada was only a beginning as GM geared for the next economic downturn, to the modification of trade agreements under the Trump administration and any tariffs on imported automobiles.

The official spoke on condition of anonymity because the announcement was not made public.

In the fall, the Detroit automaker offered 18,000 white-collar buyers buybacks, but has not yet specified how many have been accepted or are about to reach reduction targets that they have set themselves to better withstand more difficult times.

The Monday shutdown of GM's plant in Oshawa, Ont., Was confirmed Sunday night by an official aware of the decision. The official spoke on condition of anonymity because they were not allowed to speak publicly before the announcement.

GM needs to reorganize the company as it focuses on low-emission hybrid vehicles, a technology that is not at the forefront of the Canadian factory.

Too many GM factories are dedicated to manufacturing slow-moving cars and the company can no longer afford to keep them all running without making tough decisions. But the political atmosphere could limit realistic choices for the Detroit automaker.

Industry analysts are already preparing potential targets for GM, including the large plant in Lordstown, located in northeastern Ohio. The produced car is also built in Mexico. The once-busy factory has already lost two of its three shifts and 3,000 unionized jobs since the beginning of last year.

But moving this car, the Chevrolet Cruze, south of the border, may cause a brutal reaction from President Donald Trump. And GM does not know if it will really fight by imposing a 25% tariff on imported vehicles from Canada and Mexico.

What's more, Cruze's factory, located just outside Youngtown, is in a democratic, trade union stronghold, where Trump captured a surprising number of voters two years ago by addressing that he called the "forgotten men and women" of the United States.

At a rally near the factory last summer, Trump spoke of moving past large factories whose jobs "left Ohio," then ordered people to not not sell their house, because the jobs "come back, they all come back".

In total, GM has five unused car manufacturing plants in Kansas City, Kansas; Lordstown; and Detroit-Hamtramck, Lansing and Township of Orion, Michigan.

GM opened its plant in Oshawa, near Toronto, in 1953. This plant is used to manufacture Cadillac XTS and Chevrolet Impala sedans as well as Chevrolet Silverado and GMC Sierra trucks.

A spokesman for GM declined to comment. GM was expected to close factories due to sales difficulties.

Unifor, the largest private-sector union in Canada, said in a statement that it did not have detailed information on Monday's announcement, but it was informed that no product had been awarded to the Oshawa plant after December 2019.

"Based on the commitments made during the 2016 contract negotiations, Unifor does not accept this announcement and immediately calls GM to respect the spirit of this agreement," said the union in a statement posted on its website. website.

"Unifor must hold a discussion with General Motors (Monday) and will make further comments after the meeting."

Oshawa Mayor John Henry said he had not spoken to anyone about GM. Jennifer French, who represents Oshawa in the Legislative Assembly of the province, said she found the news "extremely worrying".

"If GM Canada is effectively turning its back on 100 years of industry and community – leaving workers and their families behind in Oshawa – this is a baseless decision that must be fought," she said. in a statement.