Rocked by GM's Plant Cull, Ontario Seeks to Shore Up Its Auto Sector

Steph Willems
by Steph Willems
rocked by gms plant cull ontario seeks to shore up its auto sector

General Motors’ decision to stop the flow of product to Ontario’s Oshawa Assembly plant by the end of 2019 has the province’s government promising cash and a slew of measures to keep the auto industry alive north of the border.

Ontario holds the bulk of Canada’s auto-related manufacturing jobs, with the sector adding up to nearly one-fifth of the province’s manufacturing GDP. Vehicles and parts made up 28 percent of its trade exports in 2015. On Thursday, the Ontario government rolled out the first phase of a 10-year plan to firm up the industry and make automakers reconsider Mexican investment.

The volume of Canadian-built vehicles fell by 25 percent since 2000, and GM’s decision to turn the lights out in Oshawa won’t help the trend. At last report, 13 percent of North America’s auto production occurs in Ontario.

Titled “Driving Prosperity: The Future of Ontario’s Automotive Sector,” the plan lays out a number of initiatives, among them: $40.2 million over the next three years for internships, an online learning and training portal, and an automotive modernization program. International promotion is another plank, as are “supports” for R&D and emerging technologies.

Grouped under three pillars — talent, innovation, and competitive business climate — the plan makes no shortage of promises to existing and prospective auto sector companies. Mainly, a potential reduction in the electricity rate for certain manufacturers, a reduction in red tape and a modernization of existing regulations, and a reduction in taxes. If some of those sound like promises made to all companies by conservative governments the world over, you’re right. There’s finer specifics contained in the plan, but that’s the gist. A second phase of the plan should emerge from the Doug Ford government by the end of the year.

Looking through the document, one wonders how a government of any stripe would go about maintaining “current assembly production volume and [securing] new assembly commitments.” No government in this country seems able to compel private manufacturing operations to stay open or expand without a liberal application of taxpayer cash. Well, it certainly appears that way.

Regardless, this government feels it can pull in new auto manufacturing, with a job site challenge being one tool in that strategy. The province describes it as “a competition, open to municipalities, economic development corporations, and industrial developers, for a site (500 to 1,500 acres) capable of attracting a new assembly plant. Ontario would partner with the winning proponent on site-readiness and servicing to ensure the development opportunity is competitive.”

Other tools include “improving the transparency and stability of property tax assessments” and “[streamlining] the approvals and certification process for auto manufacturing sites.”

It’s an effort, anyway — one that could prove successful. Still, one has to wonder what phase two holds.

[Image: Fiat Chrysler Automobiles]

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3 of 15 comments
  • DenverMike DenverMike on Feb 14, 2019

    Awesome, but how can those enticements begin to compare with Mexico autoworkers? And I'm not just talking pay scales.

    • Mikey Mikey on Feb 14, 2019

      To answer your question "DenverMike" ... They can't .

  • Inside Looking Out Inside Looking Out on Feb 14, 2019

    US is such an evil racist capitalist country, why Canadian do not invite caring and progressive Japanese and Germans automakers to open plants in Canada?

  • Dave M. Although the effective takeover by Daimler is pooped upon, this is one they got right. I wasn't a fan of the LHs, mostly due to reported mechanical, NVH and build quality issues, but I though Chrysler hit it out of the park with the LXs. The other hyped release that year was the Ford Five Hundred, which, while a well-built car with superior interior space, couldn't hold a candle to the 300.
  • Art Vandelay I always liked those last FWD 300's. Been ages since I've seen one on the road though. Lots of time in the RWD ones as rentals. No complaints whatsoever.
  • Cardave5150 I've had 2 different 300's - an '08 300SRT and an '18 300C. Loved them both a LOT, although, by the time I had the second one, I wasn't altogether thrilled with the image of 300's out on the street, as projected by the 3rd or 4th buyers of the cars.I always thought that the car looked a little stubby behind the rear wheels - something that an extra 3-4" in the trunk area would have greatly helped.When the 300 was first launched, there were invitation-only meet-and-greets at the dealerships, reminding me of the old days when new model-year launches were HUGE. At my local dealer, they were all in formalwear (tuxes and elegant dresses) with a nice spread of food. They gave out crystal medallions of the 300 in a sweet little velvet box (I've got mine around the house somewhere). I talked to a sales guy for about 5 minutes before I asked if we could take one of the cars out (a 300C with the 5.7 Hemi). He acted like he'd been waiting all evening for someone to ask that - we jumped in the car and went out - that thing, for the time, seemed to fly.Corey - when it comes time for it, don't forget to mention the slightly-stretched wheelbase 300 (I think it was the 300L??). I've never found one for sale (not that I've looked THAT hard), as they only built them for a couple of years.
  • Jkross22 "I’m doing more for the planet by continuing to drive my vehicle than buying a new one for strictly frivolous reasons."It's not possible to repeat this too much.
  • Jeff S Got to give credit to Chrysler for putting the 300 as a rear wheel drive back on the market. This will be a future classic.