Oshawa plant’s future at stake in Canada auto talks

Melissa Burden
The Detroit News

Oshawa, Ontario — As contract negotiations between Canada’s autoworkers union and Detroit automakers officially begin this week, employees at General Motors Co.’s Oshawa Assembly Plant will be looking for assurances that the vast and underused manufacturing facility will continue turning out cars.

Unifor Local 222 President Colin James says members fear the Oshawa plant may close.

The 2,400 hourly workers at this sprawling 5.1-million-square-foot facility just east of Toronto are uncertain if they have a future here. Analysts say the plant is at risk of closure, and GM has said for two years it needs to know labor costs before making decisions about new vehicles or investments at Oshawa Assembly.

Because the stakes are so high at Oshawa, union contract negotiations are likely to be contentious. Uncertainty about plans for Ford Motor Co.’s engine plant in Windsor and for Fiat Chrysler Automobiles NV’s assembly plant in Brampton bring additional levels of tension to the labor talks.

Workers ‘live scared’ as GM mulls Oshawa plant future

Last year, Oshawa Assembly lost its third shift and about 1,000 jobs when GM moved production of its sixth-generation Chevrolet Camaro to Lansing. Production of the Chevrolet Impala Limited, a fleet vehicle, ended about a month ago. That left only the Impala, Buick Regal and Cadillac XTS cars on the plant’s Flex Line in two shifts.

GM has said it will end production of the Chevrolet Equinox crossover next year on the plant’s one-shift Consolidated Line — a line that employs 750 and has been on life support and has gotten reprieves several times since 2008.

The union believes the XTS will be the last vehicle produced at the plant through the 2019 model year. It believes GM will move production of at least one of the vehicles to Mexico or China.

“The company in the past have had feasibility studies or launch teams if we are going to get product. This year, there’s no feasibility studies going on, no launch teams,” said Colin James, president of Unifor Local 222 which represents hourly workers at the Oshawa plant and many of the plant’s suppliers. Unifor is the labor union created in 2013 by the merger of the Canadian Auto Workers and the Communications, Energy and Paperworkers unions.

“Of course, it’s led to a lot of our members in the plant asking questions,” James said. “There’s uncertainty: ‘Why is there no launch team?’ ‘Are they planning on closing the facility?’ General Motors is basically not answering that question.”

Unifor officials have their opening handshakes with GM negotiators Wednesday in Toronto. Bargaining with Ford and Fiat Chrysler officially begins Thursday. Four-year contracts with the automakers expire at 11:59 p.m. Sept. 19.

About 3,860 GM hourly employees in Canada would be covered under that contract, including those who work at St. Catharines Propulsion and Woodstock Parts Distribution Center. There are 6,400 hourly workers at Ford plants in Canada, and about 9,400 at Fiat Chrysler plants.

Jim Wheeler is among Oshawa plant workers displaying their concerns about the future on shirts.

‘GM Oshawa Matters’

The union and community along the Lake Ontario shoreline east of Toronto have ramped up support for the plant with the “GM Oshawa Matters” campaign. The plant built more than 262,000 vehicles last year and could stimulate more than 30,000 other jobs in the economy, the union says.

Workers wear buttons declaring “Built in Oshawa Matters.” A thousand workers have purchased T-shirts warning “No Product? No Contract!” and “If Provoked, We Will Strike.” Some have held signs over bridges to let the community know what’s a stake during the next month as the union works to secure new vehicles for the plant. About 7,000 have emailed messages of support to key government officials.

Don Scott, 47, of Vaughan, Ontario, has worked at the plant for more than 11 years. He said everyone feels the uncertainty as worker ranks dwindle. As recently as 2005, there were 11,000 hourly employees.

“We work our butts off here, award after award after award,” he said. “We just want some sort of a car that’s going to take us into the next level.”

Before heading into her early morning shift in the paint shop last month, 14-year plant employee Julie Gale, 43, of Cobourg, Ontario, said, “I’m holding out hope simply because both my husband and I work here.

“It would devastate us (if GM closes the plant). I am an optimistic person and I’m really hoping that something does come and that they’re just sort of playing their cards close to them. But it’s really not looking good.”

The union is concerned not only about the future of the Oshawa plant, but also Ford’s Windsor Engine Plant and Fiat Chrysler’s Brampton Assembly Plant where the Dodge Charger, Dodge Challenger and Chrysler 300 are made.

Ford’s aging Windsor Engine Plant builds 6.8-liter V-10 engines for Ford F-Series and E-Series and employs about 600. Ford’s Windsor plant was considered for a new engine investment, but the automaker last year announced that program would go to Mexico.

Fiat Chrysler CEO Sergio Marchionne has opted to end production of cars in the U.S. and has said the Chrysler 300 could be built at the Windsor Assembly Plant, though no plans for that have been announced.

Joe McCabe, president and CEO of AutoForecast Solutions LLC in Pennsylvania, thinks the Brampton, Ontario, plant which employs about 3,300 hourly workers will stay open. But he predicts the Chrysler 300 will be phased out in late 2018. He said the plant will need new investment and may have to bring in a crossover.

Union may target UAW gains

Unifor President Jerry Dias said securing new investment and new products are the most critical issues for the union as it enters bargaining. The union will likely use as a road map the gains made by the United Auto Workers last fall in the United States: wage gains and narrowing the pay gap between veteran workers and second-tier workers.

“Getting commitments from the companies is a big, big deal for Unifor because they’re really concerned with job losses with any shutdowns,” said Tony Faria, co-director of the Office of Automotive and Vehicle Research at the University of Windsor.

GM declined to comment on the Oshawa plant ahead of negotiations. GM faces overcapacity in North America — and the Oshawa plant is a car production site during a time when consumer tastes have shifted toward SUVs and trucks. But in Oshawa’s favor is the $10.8 billion Canadian dollars that the Canadian and Ontario governments provided to help bail out GM during the economic downturn.

Automakers face unique economic issues in Ontario, Faria said. Electricity costs are much higher in Ontario than many parts of the U.S.; pension plan changes in Canada will add costs for companies; and a new cap-and-trade program aimed to lower greenhouse gas emissions will cost auto businesses more. Canadian plants have the advantage of a weak Canadian loonie relative to the U.S. dollar, but are paying more parts from companies located outside Canada, Faria said.

Local 222’s James had his own opinion: “When you look at the Canadian dollar today, for them not to put product in GM Oshawa, it boggles my mind, other than corporate greed, going to Mexico (and) China when they’re making record profits.”

Staff Writer Michael Martinez contributed.