Government Never Forgets: GM to Pay Back Cash That Funded Celebrity, Cutlass Ciera Production

Steph Willems
by Steph Willems
government never forgets gm to pay back cash that funded celebrity cutlass ciera

A bill for the assembly of two decades-old models — one from a defunct marque — will come due on April 1. And unlike much of the debts written off during General Motors’ bankruptcy, a major subsidiary now has to pay this chunk back.

The money, $220 million in all, was handed to GM Canada back in 1987 to save the Montreal-area Sainte-Thérèse Assembly plant. GM Canada used that bankroll to build the stunningly sexy Chevrolet Celebrity and Oldsmobile Cutlass Ciera. It later cranked out the last Pontiac Firebirds and fourth-generation Chevrolet Camaros.

The thing about 30-year interest-free loans is that someone eventually comes to collect.

Unlike its parent company, outstanding loans held by GM Canada prior to 2009 are still active. During GM’s bankruptcy, its Canadian division slashed its workforce and dealer network in a desperate effort to reduce costs. Things improved, but media north of the border soon began asking questions about taxpayer cash handed out long ago.

GM Canada still intended to repay the $220 million offered up by the Canadian and Quebec government, the company said in 2011. The plant, of course, no longer existed, having been torn down and the land since turned into a big-box retail mall.

Sainte-Thérèse Assembly opened in 1965, building Chevrolet Biscaynes before moving on to H- and G-body vehicles in the 1970s and ’80s. When poor quality and labor strife threatened to shutter the facility, the federal and provincial government intervened. Each offered $110 million. It was then decided the plant should be retooled to build Chevrolet Celebrity and Oldsmobile Cutlass Ciera models. After that, another reprieve — Camaro and Firebird production ran from 1993 to 2002.

After that, GM left Quebec.

Following the most recent round of labor negotiations, GM pledged $554 million for its Canadian operations. While the possibility of government cash arose, last month GM said it wasn’t necessary for the projects it had in mind. While discussing the matter with the Globe and Mail, GM Canada president Stephen Carlisle claimed the company would indeed pay back the loan on its due date — April 1, 2017.

The payment comes at an opportune time for Canada, which just pledged an interest-free loan to another crucial Montreal-area business apparently in need of propping up.

(While editing this piece, Steph asked, “Oh, can you add the adjective ‘stunningly sexy’ before the first mention of Cutlass Ciera?” I was happy to oblige. —Mark)

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2 of 31 comments
  • Jagboi Jagboi on Mar 02, 2017

    My dad bought a Ciera new in 83. For it's time, it was a good car. We never had reliability problems with it, but it did like to eat front brakes. Gave great gas mileage too, one highway trip we averaged 39 mpg with the 2.8 V6. Speed limit was 90 km/h which helped, but it was always an economical car to drive.

  • CobraJet CobraJet on Mar 02, 2017

    I had a string of three of these Cutlass's as company cars An 85, 88, and 90. The 88 was the same color as the coupe pictured. The 88 was the best one of all. It was outfitted with handling suspension, aluminium wheels, and the 3.8 V6. It would smoke the front tires.

  • Inside Looking Out You should care. With GM will die America. All signs are there. How about the Arsenal of Democracy? Toyota?
  • DenverMike What else did anyone think, when GM was losing tens of billions a year, year after year?
  • Bill Wade GM says they're killing Android Auto and Apple Carplay. Any company that makes decisions like that is doomed to die.
  • Jeff S I don't believe gm will die but that it will continue to shrink in product and market share and it will probably be acquired by a foreign manufacturer. I doubt gm lacks funds as it did in 2008 and that they have more than enough cash at hand but gm will not expand as it did in the past and the emphasis is more on profitability and cutting costs to the bone. Making gm a more attractive takeover target and cut costs at the expense of more desirable and reliable products. At the time of Farago's article I was in favor of the Government bailout more to save jobs and suppliers but today I would not be in favor of the bailout. My opinions on gm have changed since 2008 and 2009 and now I really don't care if gm survives or not.
  • Kwik_Shift I was a GM fan boy until it ended in 2013 when I traded in my Avalanche to go over to Nissan.