The Truth About Cars » oshawa The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. Tue, 15 Jul 2014 11:23:13 +0000 en-US hourly 1 The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars no The Truth About Cars (The Truth About Cars) 2006-2009 The Truth About Cars The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars » oshawa General Motors To Release Valukas Report On Ignition Switch Thursday Thu, 05 Jun 2014 12:01:54 +0000 File photo of General Motors logo outside its headquarters at the Renaissance Center in Detroit

Automotive News reports General Motors will release Thursday the results of attorney Anton Valukas’s three-month independent internal investigation into how and where the automaker went wrong before recalling 2.6 million vehicles affected by an out-of-spec ignition switch linked to 47 accidents and at least 13 fatalities. The announcement will come at 9 a.m. Eastern via webcast, with what CEO Mary Barra says will be an “unvarnished” look at the events surrounding the recall. In addition, GM will have an update on plans for compensating victims of the switch, though the attorney heading up the affair, Kenneth Feinberg, says a formal announcement won’t come until a few weeks down the road. Reuters adds the Valukas report will likely exonerate Barra, former CEO Dan Akerson and other senior execs and board members of any wrongdoing over the recall, with “a number of people” to be formally dismissed from the company due to their ties to recall. The report will be turned over to the federal government by the end of June.

Speaking of turned-over documents, The Detroit News reports some 1 million pages of records linked to the ignition switch have been turned over to the U.S. House Energy and Commerce Committee in its investigation into the matter, now expected to last well into the summer. The National Highway Traffic Safety Administration also delivered a total of 15,000 documents related to its handling of the recall to the committee, as well. As for when Barra will return for a second round of testimony before Congress, the first potential date may be set sometime in July at the earliest.

Finally, Reuters says Canadian labor union Unifor will strike at GM supplier Johnson Controls Whitby, Ontario plant if the powers that be refuse to reconsider plans to shut down the plant and move production outside of Canada in two years. The strike would “shut down GM” at its Oshawa plant according to statements made before the 36th UAW Constitutional Congress by Unifor president Jerry Dias, with the strike and negotiations set to commence in August. The Whitby plant supplies interior components for the Chevrolet Camaro and Impala, which are assembled in Oshawa alongside the Cadillac XTS and Buick Regal.

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Ontario Government Selling GM Shares To Fund Public Transit Mon, 14 Apr 2014 13:00:34 +0000 r-GM-CANADA-RD-INVESTMENT-large570

The government of Ontario has announced  it will sell its shares in General Motors as part of an effort to fund new public transit programs in the Greater Toronto Area. But the move could end up hastening the demise of GM’s Oshawa plant, located in the same metropolitan area.

According to The Globe and Mail, the sale could net about $1.4 billion for the province, which would “wait over the next year for the best time to sell.” While divesting its stake isn’t necessarily a bad thing, the timing of the sale coincides with two events that have a major impact on Oshawa’s future.

The first is the expiration of GM’s Vitality Commitment, a document signed during the bailout as part of the terms for receiving government funds., which requires GM to keep 16 percent of production in Canada until GM’s loan to the Canadian and Ontario government is re-paid, or until December 31, 2016, whichever comes first.

With the loans repaid, and GM’s shares now being sold off, the biggest question mark for Oshawa will be the expiration of GM’s contract with Unifor (formerly the CAW), which will expire in 2016, along with Unifor’s Ford and Chrysler contracts.

Oshawa has slowly seen its product whittled away, most recently losing the Chevrolet Camaro to Lansing, Michigan where the Cadillac ATS is built. As of now, the Flex Line (one of two assembly lines) has no unique product, with the Cadillac XTS and Chevrolet Impala also built in Michigan, the Buick Regal is also built in Germany and the Chevrolet Equinox/GMC Terrain are made in multiple locations.

The Consolidated Line, which builds the old W-Body Impala for fleets, is due to be shut down in 2016. The big question is whether the Flex Line will follow. The 2016 date may provide an easy out for GM, since it can use the labor contract expiry to close down Oshawa.

The plant’s closing would be a devastating blow to Oshawa, which is just as much of a “GM Town” as Flint, Michigan was in the “Roger & Me” era. Of the Detroit Three plants currently operating in Ontario, Oshawa has been in jeopardy the longest – but at this point, it’s an inevitability.

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Report: Ontario Government To Sell GM Shares To Fund Public Transit Thu, 03 Apr 2014 00:08:42 +0000 oshawaGM

The Globe and Mail is reporting that the Ontario government may dump its shares of General Motors as a way of helping to fund expanded public transit in the Greater Toronto Area.

According to the newspaper, the sale of GM shares will be part of a broader asset sale. With tax increases (namely an increased sales tax and a new levy on gasoline sales) being ruled out, the asset sale will likely be used to make up the shortfall in funding for badly needed public transit for Toronto and its surrounding regions.

At current market value, the shares are valued at $1.4 billion CAD.

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Impala Limited Fleet Special Lives On To At Least 2016, Keeps Oshawa Open Mon, 28 Oct 2013 10:30:14 +0000 mm_gal_item_c2_2.img_resize.img_stage._2

While the all new 2014 Impala is impressing reviewers, like Consumer Reports calling it this year’s highest scoring sedan, General Motors has decided to keep the outgoing Impala as a low cost option for fleet customers until 2016. According to Automotive News, the automaker had originally planned to keep the old Impala, branded the Impala Limited, in production for rental operators as well as government and corporate fleet customers, into next year. “The Impala Limited has done extremely well. Our fleet customers know the car and like it,” a GM spokesman said last week. “It’s a business opportunity that we want to continue to fulfill.”

The continued production of the Impala Limited means that the Oshawa Car Assembly plant in Ontario will remain open until at least 2016.

GM has used the strategy of offering fleet only models, like the Impala Limited and the Chevy Captiva, as a means of both making money from the fleet sales and reducing the chances that those fleet sales will negatively affect resale values and with them consumer loyalty. The car company has also kept outgoing Malibu fleet special models in production side by side with new models. Before the redesign, about two thirds of Impala sales in recent years have been to fleets and the car developed a reputation as a rental special. Chevy is hoping to flip those numbers and more, with a target of 70% retail sales for the Impala brand, improving the model name’s cachet with customers.

Higher transaction prices are what car companies are chasing these days, and the new Impala can cost between $1,000 and $5,000 more than a comparably equipped 2013.

The previous Impala has been in production since 2006. Analysts say that the tooling for that car has been paid for a long time ago so GM can offer it as an inexpensive, high volume fleet model and still make money on it, while not hurting the new model’s residual value.

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General Motors To Keep Oshawa Consolidated Line Open Past 2014 Thu, 17 Oct 2013 14:33:18 +0000 photo3-550x412

A brief memo from General Motors Canada confirmed that the Oshawa consolidated line, scheduled to close in 2014, will stay open until 2016. GM is citing strong market demand for the Chevrolet Equinox and the outgoing, Chevrolet Impala (sold as a fleet-only model) as a reason for the decision, but cautioned that ” All scheduling adjustments are subject to market demand”.

Under the terms of the bailout, GM must keep 16 percent of its production in Canada until it has repaid its loan obligations to the Canadian government, or until December 31, 2016. After that date, the future of Oshawa is uncertain.

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A Bleak Forecast For Canada’s Auto Industry Fri, 04 Oct 2013 19:46:09 +0000 2014-Chevrolet-Impala-Exterior-001-450x255

The Globe and Mail‘s Greg Keenan reported some bleak news for Canada’s auto industry today, with Canada’s auto manufacturing output set to decline by as much as 25 percent by 2020.

While Canada built over 2.4 million vehicles in 2012, that number is expected to drop to 1.8 million by 2020, according to a report cited by Joe McCabe, president of AutomotiveCompass LLC, who spoke at a conference for the  Automotive Parts Manufacturers Association of Canada.

Since 2010, auto makers have invested $42 billion in manufacturing, with Canada receiving a mere 5 percent of that. The biggest declines are expected to come at GM and Chrysler, with both companies moving key product out of their Canadian facilities. Production of the Chevrolet Camaro will move from GM’s Oshawa, Ontario plant to Michigan, while Chrysler’s axing of one of its minivan nameplates could see the end of a full three-shift schedule at its Windsor, Ontario plant.

GM is set to close its Consolidated Line at Oshawa next year, leaving only the Flex Line running. But no new product has been confirmed beyond 2016, when GM’s “vitality commitment” to the Canadian government runs out, and it is no longer obligated to keep a certain percentage of its vehicle production in Canada. No GM vehicle is exclusive to the Flex Line either, with the Buick Regal, Chevrolet Impala, Cadillac XTS, Chevrolet Equinox and GMC Terrain all built at other facilities as well as Oshawa, while GM’s Dan Akerson has stated that Canada is the most expensive location in the world to build a car.

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Oshawa’s Future Looks Bleak As The Clock Runs Out On GM’s Vitality Commitment Mon, 24 Jun 2013 13:00:39 +0000 450x270x001-2014-buick-regal-opt-450x270.jpg.pagespeed.ic.RilyP5jxqe

Ontario is home to a number of auto plants, both import and domestic, union and non-union, as well as numerous suppliers. None of them are so tightly intertwined as General Motors is with the town of Oshawa, about 40 miles from Toronto (though, as any area resident will tell you, it’s really 2 hours away, thanks to our horrendously inadequate infrastructure). For nearly a century, GM has been building cars in Oshawa in one form or another, as the plant has established a reputation as one of GM’s best, consistently building high quality cars, trucks and crossovers over the decades. But that tradition may be coming to a close by 2016.

A report by The Globe and Mail comes to the same conclusion that TTAC has reached since last year: Oshawa’s future is looking bleak in the face of unfavorable exchange rates, high labor costs and an exodus of product, with no plans to replenish the factory with any new vehicles. Since the bailout era, Oshawa has seen a glut of product leave for other destinations. First to go were the full-size trucks, followed by the Chevrolet Impala (now split with Hamtramck, along with the Cadillac XTS) and then the Chevrolet Camaro.

Now, The Globe is reporting that the Buick Regal, which is currently built at Oshawa, may not be replaced after 2016, while another report by Ward’s Auto says otherwise. With sales of the smaller Verano cannibalizing Regal sales, Buick has a good reason not to replace the Regal. The Regal, based on the Opel Insignia, may also be a victim of rapidly declining D-segment car sales in Europe. Opel may not see a reason to replace a car that competes in one of the weakest segments, especially in light of Opel’s declining fortunes.

With the potential loss of the Regal and the confirmed exit of the Camaro, also that’s left is the Impala and XTS (which is in danger of leaving altogether for Hamtramck) and overflow production of the Theta crossovers, which are built in Ingersoll, Ontario, halfway between Oshawa and Windsor, Ontario, at a modern facility of their own, as well as the newly re-opened Spring Hill, Tennessee plant where workers are paid on the lower end of the UAW’s two-tier wage scale.  Even the CAW has expressed their concerns that Oshawa will wither and die if new product is not brought over.

Product aside, two other factors are likely weighing on GM. The first is the expiration of the “Vitality Commitment” in 2016, which was made as a condition of GM receiving bailout funds from the Canadian and Ontario governments. While the exact terms have never been spelled out, it’s been widely reported that the terms require GM to maintain a minimum of 16 percent of its production in Canada until it repays its loan obligations or until December 31, 2016, whichever comes first. It’s also not known what the penalty would be if GM violated these conditions. Not even the original document, publicly released by GM and the Canadian government, delves into these specifics.

The second factor, according to The Globe, is the billions of dollars in financial obligations that will be due for GM at the end of the decade, including rapidly rising pension costs, interest free loan payments and payments for a note issued by GM to help cover health care costs. The timing of these obligations and the lack of product for Oshawa is almost certainly coincidental, but they represent an extremely unfortunate convergence of poor circumstances for GM’s Canadian operations.

The loss of Oshawa would not only be a blow for GM, but a massive one for Canada’s manufacturing sector as well. Despite possessing an educated, productive and conscientious workforce, the auto industry is on a massive drive to cut costs across the board, while the CAW has repeatedly taken a tough line on any concessions, as they seek to get the best deal possible. The best case scenario would be if GM uses the threat of leaving Oshawa to help get some government “assistance”, similar to how both levels of government helped chip in to revitalize Ford’s Oakville plant. More ominously, this is the model followed by Holden and Ford Australia for many years. Australia, which has many things in common with Canada (population, an abundance of resources, a strong currency) is currently experiencing a severe decline in its own auto manufacturing sector, in part due to high labor costs.

On the other hand, December 31, 2016 is a long way away; GM’s planners may be looking that far down the road, but one Robert Anthony Lutz would be the first to tell them that it’s impossible to predict what will happen months from now, let alone that far away.


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W-Body Impala Gets A One-Year Stay Of Execution Wed, 13 Mar 2013 14:33:38 +0000

The W-Body Chevrolet Impala, so beloved by the horribly biased, anti-Detroit, anti-GM staff and readership of TTAC, will live on for one more year, as a fleet vehicle dubbed the “Impala Limited”.

The news came at the launch of the new Epsilon-based Impala, which is moving the full-size Chevrolet in a totally different direction. The W-Body made up as much as 75 percent of its sales volume via fleets, but Chevrolet is looking to turn that around completely, with a target of 70 percent retail sales for the new Impala.

Aside from having the Impala Limited catering to fleet customers, continuing the W-Body helps GM keep their Oshawa plant running at capacity, particularly the Oshawa Consolidated Line, which is set to close once the W-Body ends production. This also helps GM meet its “Vitality Commitment’, which requires GM to maintain a minimum production level in Canada. The new Impala will split production between Oshawa and Michigan.

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CAMI Gets $250 Million Investment For Flexible Assembly Line Fri, 08 Mar 2013 22:28:10 +0000

GM announced a $250 million dollar investment for the CAMI plant in Ingersoll, Ontaro. CAMI is the main production site for the Chevrolet Equinox and GMC Terrain (also known as the Theta crossovers), two of GM’s best selling models, and the investment comes amid uncertainty over the fate of CAMI itself.

Earlier in the year, CAMI was one of three sites being considered for production of the next generation Terrain and Equinox, along with GM’s former Saturn plant in Spring Hill, Tennessee and a site in Mexico. In its current state, CAMI is running beyond maximum capacity, with overflow being sent to GM’s Oshawa, Ontario plant as well as Spring Hill. Both Spring Hill and Mexico were being considered due to the lower costs; Tennessee is staffed mainly by new hires who are paid wages roughly half that of most UAW workers, while Mexico’s costs are substantially lower than in Canada or the United States.

While GM ultimately decided to invest the $250 million in CAMI, there is no official word on whether it will build the crossovers. A GM press release described the investment as being earmarked for a flexible assembly line, similar to the one utilized in Oshawa. A flex line is capable of building any number of vehicles on one assembly line. While crossovers make up 40 percent of Canada’s light vehicle exports, this opens the door for CAMI to produce almost anything in GM’s lineup.

On the other hand, there are a few factors that could pop up at a later date. CAMI could see Theta production migrate elsewhere, as GM attempts to increase the profitability of these vehicles, which sold over 300,000 units combined in 2012. Another issue is possible job losses associated with increased robotization, something the Canadian Auto Workers union is well aware of. And finally, the CAMI investment raises further questions about the future of Oshawa, which has slowly seen its product migrate back to American plants.

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Analysis: The Clock Is Ticking For GM’s Oshawa Plant Fri, 08 Mar 2013 13:30:58 +0000

Upon receipt of a multi-billion dollar loan from the Canadian government, General Motors signed a “Vitality Commitment”, essentially a covenant in the loan agreement between GM and Canada’s government, which guaranteed that a certain amount of GM’s North American production would remain in Canada. That number is widely reported as being 16 percent, while page F-69 of GM’s IPO filings outlines that the covenant is valid until GM repays its loan commitments or until December 31, 2016, whichever comes later.

While Oshawa has widely regarded as one of GM’s best plants in terms of producing high-quality vehicles, the future of GM’s Oshawa plant is looking increasingly bleak.

The first post-bailout blow to Oshawa was the announcement that production of the next-generation Chevrolet Impala and Cadillac XTS would be split between Oshawa (its traditional home) and GM’s Hamtramck plant, which also builds the Chevrolet Volt and Malibu. Oshawa has long been the domain of the W-Body Impala and the announcement that GM would close the “Consolidated Line” that builds the Impala and GM’s Theta crossovers (the Chevrolet Equinox and GMC Terrain, both hot sellers) was a blow to Canadian manufacturing and the Canadian Auto Workers union.

The CAW managed to keep the Consolidated Line open until 2014 as part of their 2012 contract negotiations with the CAW. But the contract, which expires in late 2016, will coincide with the “drop dead” date for GM’s Canadian Vitality Commitment. What happens between now and 2016 is anyone’s guess, but it’s possible to draw some conclusions based on events that have transpired.

In early 2013, GM announced that production of the next-generation Chevrolet Camaro would shift to its Lansing, Michigan plant in 2015. The main reason behind the move is GM’s desire to consolidate production of vehicles built on its rear-drive Alpha platform to one location.  However, the move means an estimated 100,000 units of production will be taken off the “Flex Line”, where the Camaro, Impala, XTS, Theta crossovers and the Buick Regal are built – it’s entirely possible that the Flex Line could see a reduction from three shifts to two once the Camaro is gone.

The remaining product is hardly Oshawa’s saving grace. The Theta vehicles are mostly built at GM’s CAMI facility in Ingersoll, Ontario, as well as in Spring Hill, Tennessee (which handles overflow production, much like Oshawa). Like GM’s Michigan plants, wages at Spring Hill are significant lower than in Ontario. Spring Hill has the benefit of being a re-opened plant, able to pay new hires $15.78 an hour, or about half of the going CAW rate of $34 an hour. The Regal is a dud in the marketplace (selling a paltry 24,616 units in 2012), having been cannibalized by the Michigan-built Buick Verano, and it’s unclear if it will be replaced in Buick’s lineup at all, though Morgan Stanley’s Auto Product Guidebook, considered an authoritative source on GM’s future product, suggests a 2015 redesign. That leaves the Impala and the Cadillac XTS as the sole remaining product with any long-term viability at Oshawa, and even then, it’s feasible that GM could decide to shift production to Hamtramck, which likely has excess capacity due to its immense size and slow sales of both the Chevrolt Volt and Malibu.

Industry observers know that unused capacity costs auto makers a lot of money, and Oshawa is particularly vulnerable to this phenomenon as well. With its enormous size and the massive amounts of money poured into it by GM, under-utilization of the Oshawa plant would be an enormous financial drain on GM. In addition, higher labor costs in Canada and a (currently) unfavorable exchange rate would merely add to the pain. At that point, closing Oshawa would be something GM would have to consider – if it isn’t already on their minds. In this scenario, Hamtramck would get the remaining Impala/XTS production, allowing GM to boast of “bringing jobs home”, while production of the Theta vehicles would be largely unaffected, with CAMI and Spring Hill available to produce them. The Regal, which is built on the global Epsilon II platform, could also be shifted elsewhere, to GM’s Fairfax, Kansas plant or even Hamtramck.

Without the loan agreement and the Vitality Covenant being made public, it’s difficult to gauge the consequences of an Oshawa shutdown. The timing of the agreement and the CAW contract expiration dates suggests that the plant’s closure is a very real possibility. On the other hand, two factors stand in the way of such a theory. One is the enormous negative PR that GM would face if the Oshawa plant closed. Oshawa is the historic home of not just General Motors, but Canada’s auto manufacturing industry, stretching back over a century. While Canada is a small market, it’s entirely possible that sales of GM cars would suffer in the event of an Oshawa shutdown. Needless to say, the community itself would be negatively affected in a massive way.

Second is the currently rosy outlook for the U.S. and Canadian new car market. With a SAAR of 15.3 million units currently forecast for 2013, observers seem to be bullish on the medium-term prospects of new car sales, and GM is making a big push itself. The Impala and Theta crossovers are some of GM’s best sellers, with Theta selling over 316,000 units in 2012 combined and the Impala moving 169,351 units, despite a relatively antiquated design.

Of course, this is all predicated on increasing levels of sub-prime financing for vehicle sales in the United States, as well as and high prices for used cars, factors which many have chosen to omit from their own assessments. These are potential “wildcards” that could derail an auto industry rebound, and are made all the more prescient by news that Ally Financial, a government backed bank that was once GM’ finance arm, has failed a “stress test”. While Ally is GM’s lender of choice for GM’s customers with solid credit scores, GM’s own sub-prime lending arm, GM Financial, has also come under fire for its lending and auto loan securitization practices.

Despite the gloomy outlook, Oshawa does have one saving grace; the Flex Line is among the world’s most modern facilities for auto production, able to build practically any car or truck with minimal interruptions (hence its name). GM could conceivably decide to bring in new product to built at the plant to make up the shortfall, if it really wanted to. But so far, Oshawa’s future seems to hinge on the Impala, which is not a situation that inspires confidence.

** N.B:  GM committed $675 million over the four year term to “Canadian manufacturing”. Rather than specify Oshawa, it’s possible that the money could go to CAMI, their St. Catharines, Ontario engine plant, or their other facilities. Currently, GM and the CAW workers at CAMI are negotiating their contract, largely due to the possibility that GM would move Theta production to Mexico or Spring Hill. CAMI has always been treated as a separate entity from Oshawa, with lower wages and benefits (more in line with Spring Hill), and is a modern factory built in partnership with Suzuki. Workers at CAMI are said to be aiming for a “pattern agreement” similar to what Oshawa workers received, but the terms will be unknown until negotiations have wrapped up.



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CAW: Oshawa Needs New Product To Survive Thu, 20 Dec 2012 16:26:37 +0000

GM’s announcement that it would move Camaro production out of Oshawa has left one of GM’s best plants in a lurch, and the CAW says that the plant’s very survival is at stake.

Moving the Camaro to GM’s Lansing, Michigan plant makes sense; the Camaro is the sole rear-drive product built at Oshawa, while the Cadillac CTS and ATS are not only built in Lansing, but expected to share a platform with the Camaro in the coming years. But that’s raised questions about what GM will do to keep Oshawa going. Speaking to The Globe and Mail, CAW President Ken Lewenza expressed concerns regarding a possible slow decline for the plant

“A fully utilized plant today is on three shifts,” he said. “If this 100,000 units drops it to two shifts – which I anticipate it does – without any replacement vehicles, then the next move is one shift and [then] gone.”

The Camaro move will not only affect Oshawa, but also GM’s engine plant in St. Catharines, Ontario and a Johnson Controls plant in nearby Whitby. Both plants are nearly entirely dependent on the Camaro and will likely have to close following its departure. Lewenza claimed that during this summer’s negotiations, GM gave no notice that they planned to move the Camaro out of Oshawa. Without it, Oshawa will be left with the Cadillac XTS Buick Regal and the Chevrolet Impala

Complicating matters is the Canadian government’s reluctance to sell their stake in GM. While officials have previously stated that they don’t plan to hang on to their shares for the long term, there’s still the pesky matter of Canada’s $13.7 billion bailout package to GM. As part of the agreement, 16 percent of GM’s production must come from Canada, but it looks like the continued production of the previous generation Impala should help satisfy the requirements until June, 2014. Beyond that, it’s anyone’s guess. GM recently invested $185 million into the facility, but the figure pales in comparison to the billions it has received from the Canadian government.

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Current-Generation Chevrolet Impala Gets A New Lease On Life – Will The Bench Seat Get One Too? Thu, 20 Dec 2012 14:00:58 +0000

Christmas has come early for our beloved commenters Zackman and Mikey – GM has confirmed that the current generation Chevrolet Impala will be produced until June, 2014, ostensibly for fleet duty and used car market fodder.

The announcement was buried in a press release for the Camaro’s move to Michigan, with GM proudly stating that

The consolidated line at Oshawa Assembly will continue to produce the current generation Chevrolet Impala and Equinox until June 2014.

Chevrolet has a history of churning out previous bodystyles as fleet only specials; witness the Captiva Sport, aka the Saturn Vue, as well as numerous old bodystyle Malibus badged as the “Classic”. The big question here is, of course, how long will the bench seat remain in production. Does it die with the transition to fleet-only sales, or will it live on in Avis lots across the land?

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GM Moving Chevrolet Camaro Production From Oshawa To Lansing Wed, 19 Dec 2012 16:40:31 +0000

GM is set to announce that production of the Chevrolet Camaro will move from its current home in Oshawa, Ontario, to a plant in Lansing, Michigan.

According to The Globe and Mail, GM and the Canadian Auto Workers agreed to keep production of the Camaro in Oshawa until 2014, when the current generation ended its lifecycle. Beyond that, no promises were made.

Recent contract negotiations between GM and the CAW saw Oshawa recieve a third shift at its “flex line” to build the all-new Chevrolet Impala. The Camaro is currently built on the flex line, alongside the Buick Regal, and the move is sure to be a blow to workers at Oshawa, which recently had its consolidated assembly line closed after Impala production was partly moved to another plant in Michigan.

The best case scenario is that GM is betting big on the Impala, and looking to free up further capacity for the full-size sedan – or perhaps another car. At worst, it’s a way of sticking it to the CAW, or an attempt to divest from Canada and its high labor costs.

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CAW Strike At Key Parts Suppliers Mon, 29 Oct 2012 13:00:35 +0000

The drama over a possible strike at the Big Three was averted this summer, but it ain’t over yet; roughly 75 employees walked off the job at two key suppliers this weekend.

Westcast and Lear were affected by the job action. Automotive News, citing information from Westcast, reports that the exhaust manifold supplier has a 65 percent market share among the Big Three, and a 51 percent market share overall. General Motors will take the brunt of the job action at Lear, as workers walked off the job at their seat plant near Toronto. The plant supplies seats for vehicles assembled at GM’s Oshawa plant.

A statement released by the union regarding Westcast said that

“In the last few days, we’ve learned that General Motors intends to move the current work performed at Wescast to a facility in China. There is absolutely no reason that our members should agree to a new contract that undercuts their own jobs.”

Westcast announced this summer that it had struck a deal to be bought by Sichuan Bohong Industry Co, but the deal has yet to be finalized.

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General Motors Adding Shifts At Ontario Plants Fri, 05 Oct 2012 17:08:56 +0000

Good news for Canada’s manufacturing sector; GM has confirmed plans to add a third shift to the Oshawa Flex Line to help meet demand for the 2014 Chevrolet Impala.

An article in the Windsor Star confirmed the move, as well as the retention of one shift at the Oshawa Consolidated Line, which gets a stay of execution until June, 2014. GM’s St. Catharines, Ontario transmission plant, will also get a third shift to produce six-speed gearboxes.

Under their new agreement with the CAW, GM has promised to maintain the current level employment with its 7,000 CAW workers, and invest $675 million into their Canadian operations. The exact terms of the deal are a secret, but this is a promising start if nothing else.

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Oshawa Consolidated Line Looks Set To Remain Closed As CAW Talks Drag On Thu, 20 Sep 2012 14:02:07 +0000

The Windsor Star is reporting that the CAW “has all but given up” on trying to re-open the Oshawa Consolidated line that was closed earlier this year. The Star quotes CAW President Ken Lewenza as saying

“We’re going to keep raising it until the deal is done…But the reality is vehicle production is based on market and market is based on capacity and GM told us they don’t need the capacity.”

The Consolidated line, which built the Chevrolet Impala, and handled some Chevrolet Equinox production, was shuttered as GM sent production of the two vehicles to the United States, where labor costs are cheap (drastically so, in the case of the Tennessee plant which will now build the Equinox).

The CAW is hoping to secure “restructuring benefits”, such as buyouts, for the 2,000 workers on the line. GM apparently promised to abide by the terms of the 2009 bailout, which states that 16 percent of their North American production must remain in Canada – the closing of the Consolidated line means that GM would only be at 13 percent, leaving open the question of where the extra capacity will come from.

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General Motors To Invest In Oshawa R&D Tue, 24 Jul 2012 15:04:40 +0000

The closing of the Oshawa Consolidated Line supposedly had GM in the bailout doghouse – the company was supposed to maintain a certain level of production in Canada according to the terms of their bailout package. As far as we know, GM hasn’t replenished that yet, but they are throwing the Canadian federal and Ontario governments a bone by investing an undisclosed nine-figure sum into R&D at Oshawa.

A report in The Globe and Mail explains the funding increase

“One of the promises GM Canada made to the two governments in 2009 was that it would spend about $1-billion on research and development projects between then and 2016…The projects to be initiated or expanded between now and 2016 are expected to focus on environmental technologies, electric vehicles, vehicle weight reduction and so-called intelligent transportation systems.”

Prime Minister Stephen Harper and Ontario Premier Dalton McGunity are expected to be in attendance, though the recent string of gun deaths in Toronto will likely dominate the media scrum. That means that nobody will ask GM how it plans on meeting other bailout conditions, like

“As part of its 2009 commitments, GM Canada also agreed that its Canadian plants would produce 16 per cent of the vehicles General Motors Co. assembled in North America between 2009 and 2016…a fuel-efficient transmission at its St. Catharines, Ont., operation and… assembly of five new vehicles in Oshawa or Ingersoll during the same period.”

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Closing Oshawa Could Violate GM’s Bailout Conditions Fri, 22 Jun 2012 13:55:18 +0000

As part of their bailout package, General Motors agreed that at least 16 percent of its North American production would take place in Canada. The closing of the Oshawa consolidated line may cause GM to be in violation of those terms.

A report in the Globe and Mail states that unless GM can find more capacity, whether at the Oshawa flex line or elsewhere, GM will only be building 13 percent of its North American-produced vehicles in Canada once production of the Impala and Equinox moves to factories in the United States. Currently, the two Oshawa lines and the CAMI plant in Ingersoll, Ontario account for a 21 percent share.

GM says it intends to honor its commitments, but no government officials would divulge the penalties or mechanisms in place to ensure that GM complies. Negotiations with the CAW are scheduled to begin this summer, and the union is hoping to save the roughly 2,000 jobs at stake by reversing GM’s decision on the consolidated line and convincing them to add a third shift to the Oshawa flex line, something that GM says is not in the cards.


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GM’s Akerson Asks CAW To Cut Hourly Wage Costs Wed, 13 Jun 2012 18:00:46 +0000

Calling Canada “the most expensive place in the world to build a car right now“, Dan Akerson threw his hat into the “hourly wage costs need to come down” ring at GM’s annual shareholders meeting on Tuesday.

Unlike in the United States, there is no two-tier wage scale for Canadian Auto Workers union members, a decision that prompted GM to close a line at the Oshawa assembly plant, and move production of the Impala and Equinox to plans where workers can make $14 an hour rather than $32 an hour.

GM’s “all-in” labor costs in Canada are estimated to be $60 per hour, whereas the pre-2011 agreement  that GM had signed with the UAW meant that American labor costs pegged at about $56 an hour. Negotiations between the Big Three and the CAW are due once the current labor contracts expire in September. The CAW responded by stating that the strong Canadian dollar and higher labor costs was evened out by increased productivity. GM’s Oshawa plant in particular has a stellar reputation as one of GM’s best plants.

Sparring over things like cost-of-living adjustments has already begun between the two sides, while bonuses based on company profitability are expected to be the biggest sticking point in negotiations.

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Is There A Silver Lining Amid The GM Oshawa Closure? Fri, 01 Jun 2012 17:06:10 +0000

GM has just gotten back to us about the Oshawa Consolidated plant closing down next year, and despite the carefully worded, PR-approved statements, there are some good nuggets of information, and perhaps a couple conclusions to draw from here.

The Consolidated line was originally set to close in 2008, based on plans drawn up in 2005. Demand for the Equinox and Impala meant that the line stayed open until now. The shutdown will occur in phases, with the third shift phased out in the fourth quarter of 2012, and the second shift ending in the first quarter of 2013. Production will end when the final current-gen Impala rolls off the line in 2013.

With the introduction of the new Impala and the Cadillac XTS, production will shift to the Oshawa “Flex” line that builds cars like the Buick Regal and Chevrolet Camaro. Currently, GM estimates that two shifts should be sufficient to meet demand for all cars, but, as a GM spokesperson noted

“…based on market demand and the introduction of the next generation Impala on the Flex Line, there may be a need for additional capacity in the future.”

GM also confirmed that despite some early reports, there were no plans to build the Impala at a re-opened plant in Alabama. Detroit-Hamtramck would be the sole venue for U.S. Impala production. Presumably, GM is banking on strong sales and a third shift at Oshawa to meet demand, and hopefully the workers who will be on “indefinite layoff” would get a crack at those jobs. Those who aren’t may be able to opt for a retirement package.

Once again, we’d like to thank Mikey and other readers who have shared their experiences at GM/Oshawa and invite them to contribute in any way they feel comfortable. Comments can be left below, and as always, we can be contacted at


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GM Closing Oshawa Consolidated Line, Equinox And Impala Production Moving To United States Fri, 01 Jun 2012 01:02:30 +0000

General Motors will announce tomorrow that their consolidated line at Oshawa, currently building both the Chevrolet Equinox and Chevrolet Impala, will close. 2,000 of the 4,000 jobs at the Oshawa plant are located at the consolidated factory, and GM apparently won’t be re-investing in the facility.

Under the new plan, GM would move Chevrolet Impala production to the Detroit-Hamtramck plant, and any overflow production would not return to the Oshawa “flex line” because the 2014 Impala is a “different body style”. The Equinox will likely move to Spring Hill, TN

A report by a local media outlet quoted CAW Local 222 President Chris Buckley as stating that Impala production would be split between Michigan and a plant in Alabama, but no GM plants in the South come to mind. Buckley is also quoted as saying that the UAW agreed to be more flexible with their contract in a bid to bring more vehicle production to the USA.

Although TTAC often gets accused of anti-GM, anti-Union bias, its a sad day when 2,000 hard working GM employees get caught in the midst of corporate politics factors like an a favorable exchange rate (as the B&B have pointed out). One of GM’s best plans, which has won accolades for the high quality of its vehicles, will end up shuttered permanently. No official announcement has been made, but we’ll be keeping an eye out.


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Impala Production Shifts To Detroit, Creates “Nervousness” In Oshawa Thu, 26 May 2011 00:08:51 +0000

When I visited GM’s Detroit-Hamtramck Assembly plant back in October, I was greeted with a few surprises. One was a small fire that flared briefly on my sweater after a cinder from the Volt’s body-welding station struck me. The other was the sight of GM’s latest, most high-tech green car being assembled on a line that was filled with GM’s oldest-school dinosaur cars, the Cadillac DTS and Buick Lucerne. The scene was no doubt intended to inspire appreciation for the changing face of GM, but the scarcity of Volts amid the oceans of giant front-drive barges (production was just beginning) made it clear that it would be a while before Volt production would occupy much of the sprawling facility. With the DTS and Lucerne headed for retirement, the new 2013 Malibu will be taking up residence at Detroit-Hamtramck later this year, even as Volt production capacity is increased to hit next year’s 60k unit goal. And now GM is announcing that the next generation of Chevy Impala will be built at Detroit-Hamtramck as well, leaving folks in Oshawa saying “eh?” (or words to that effect).

I’m sure TTAC’s resident Oshawa Impala vet, mikey, will want to weigh in here, but in the meantime, here’s what CAW president Ken Lewenza is telling AN [sub] about GM’s move to bring Impala production back to the states:

It creates a sense of nervousness because you need the market to substantiate two facilities building the same vehicle. If the market isn’t there, one would have to take a look and question GM’s decision when they already had the investment in the Oshawa facility.

GM has not publicly stated when production of the next-gen Impala will begin in Detroit, or that Oshawa will definitely lose production of the car. But, as Lewenza points out, tooling up Det-Ham would allow GM to potentially pull the Impala out of Oshawa where it has been built with only brief interruptions since 1965. And, as it turns out, Lewenza could have reason to worry: the CAW has opposed the UAW’s two-tier wage structure, and its contract with GM is up in 2012 (Impala is said to be all-new for the 2014 model-year). Creating “overflow” capacity at Det-Ham could be as useful as a negotiating tool to force the CAW to accept two-tier as it is for actually keeping up with excess demand (GM must build 16% of its NA production in Canada under the current contract).

And luckily Det-Ham is a giant facility, with almost 3m square feet and an initial capacity of 250k units annually when it was built in 1985. Last year the plant built a little over 50k units, but with Volt production reportedly headed for 120k annual units (although definitely not next year… would someone please tell the feds?), GM will probably keep Malibu and Impala production on a strictly overflow basis. If that 250k capacity still applies (and it may not), there could only be 130k units of capacity for Impala and Malibu combined. If Fairfax remains the main Malibu production site, GM might be able to threaten the CAW with an Impala pullout, but that would limit further Volt ramp-ups, including Det-Ham production for a likely Volt MPV.

In short, mikey‘s Impala-building bretheren probably have nothing to fear… except the two-tier wages which they’ll probably be forced to accept at some point. Luckily the UAW may use the current negotiating session to narrow the gap between the tiers, creating a more equitable option for the CAW. That could be the key to keeping the Impala where it’s been since the days when GM enjoyed a 50%+ market share.

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Regal: More Than Just Bred On the Autobahn Thu, 12 Nov 2009 14:51:46 +0000 Born and bred in Deutschland

The single trim level is what tipped us off, and if we’d looked closer at its spec sheet, we’d have seen that its manufacturing location is listed as “Rüsselsheim, Germany.” Automotive News [sub] reports that Regal will be built in Germany for 15 months before production shifts to Oshawa. Which makes the Regal even more of an odd duck. In addition to being stuck into GM’s bursting lineup of Epsi-II midsize sedans, it’s also losing whatever profit it might have made on the dismal foreign exchange rate and the boat ride over from Europe. Or it will be just plain overpriced. Think of it as the love child between a Saturn Astra and a Pontiac G8. And another sign that some things never change.

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