VIDEO: GM to close Oshawa plant, four U.S. plants in massive reorganization push

Company to focus on electric and autonomous vehicle programs

Workers from Oshawa’s General Motors car assembly leave the plant, Monday Nov 26 , 2018. (THE CANADIAN PRESS/Eduardo Lima)

General Motors will close its production plant in Oshawa, Ont., along with four facilities in the U.S. as part of a global reorganization that will see the company focus on electric and autonomous vehicle programs.

The auto manufacturer announced the closures as part of a sweeping strategy to transform its product line and manufacturing process to meet changing demand in the transportation industry, a plan that it said will save the company US$6 billion by the year 2020.

“This industry is changing very rapidly, when you look at all of the transformative technologies, be it propulsion, autonomous driving… These are things we’re doing to strengthen the core business,” GM chief executive and chairwoman Mary Barra told reporters Monday. “We think it’s appropriate to do it at a time, and get in front of it, while the company is strong and while the economy is strong.”

GM also said it will reduce salaried and salaried contract staff by 15 per cent, which includes 25 per cent fewer executives. The US$6 billion in savings includes cost reductions of US$4.5 billion and lower capital expenditure annually of almost US$1.5 billion.

GM’s shares in New York jumped as high as 7.8 per cent to US$38.75. The automaker’s shares were trading at US$37.95 by the early afternoon, their highest level since July.

Unifor Local 222 shop chairman Greg Moffat said Monday the plant is not closing “without the fight of our lives.”

READ MORE: Uber suspends self-driving car tests after death

The Oshawa Assembly Plant employs 2,522 workers with Unifor Local 222, according to GM’s website. Production began on Nov. 7, 1953, and in the 1980s the plant employed roughly 23,000 people.

GM is also closing the Detroit-Hamtramck Assembly plant in Detroit and the Lordstown Assembly in Warren, Ohio in 2019. GM propulsion plants in White Marsh, Md., and Warren, Mich., are also due to close as well.

The automaker did not say the plants would close, but used the term “unallocated,” which means no future products would be allocated to these facilities next year.

The closures come as North American automakers feel pressure from U.S. tariffs on imported steel and aluminum. Last month, GM rival Ford Motor. Co. reported a US$991 million profit during its third quarter, but said tariffs cost the company about US$1 billion. Of that amount, US$600 million was due largely to U.S. tariffs on imported steel and US$200 million from retaliatory tariffs imposed by China on American vehicles, Ford said.

The restructuring announcement also comes after Canada and the U.S. reached the United States-Mexico-Canada Agreement to replace the North American Free Trade Agreement, after months of strained negotiations.

Under the new trade deal, 40 per cent of the content of automobiles must be produced by workers earning at least US$16 per hour to qualify for duty-free movement across the continent. The agreement also stipulates that 75 per cent of the automobile’s contents must be made in North America in order to be tariff-free.

Meanwhile, GM’s Barra said Monday the company will be investing in autonomous and electric vehicle technology.

The Canadian Press

Like us on Facebook and follow us on Twitter

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Moen tapped to run for Green Party in North Island riding

Moen says all issues should be viewed through environmental lens

VIDEO: Save Wild Salmon demonstrators march in Campbell River

March to put pressure on federal government to fulfill Cohen report recommendations

Unofficial holidays: Here’s what people are celebrating for the week of Sept. 27 to Oct. 3

World Farm Animals Day, Drink Beer Day and Virus Appreciation Day are all coming up this week

NDP candidate Babchuk a fixture in local politics since 2005

School trustee, city councillor and regional district chair sets sights on being North Island MLA

Multiple incidents of bear-spraying investigated

Police are investigating multiple incidents of people being bear sprayed on Sept.… Continue reading

QUIZ: Do you know what’s on TV?

Fall is normally the time when new television shows are released

Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

Join Black Press Media and Do Some Good

Pay it Forward program supports local businesses in their community giving

Vancouver Island Tour de Rock riders roll into Parksville Qualicum Beach

Saturday’s schedule includes Port Alberni, Ucluelet and Tofino, followed by Nanaimo on Sunday

PHOTOS: 2nd calf in a month confirmed among Southern Resident killer whale pod

Center for Whale Research said they will eagerly await to observe the calf to evaluate its health

2 British Columbians arrested, 3 at large in massive Alberta drug bust

Eight people are facing 33 charges in what police have dubbed Project Incumbent

Most Read