A Canadian union says GM is threatening to shutdown a big vehicle assembly plant in the province of Ontario.
Unifor, which represents most unionized autoworkers in Canada, said it had been informed by GM that there would be no product allocated to the plant in Oshawa after December 2019, a development that would affect production at the plant, according to Reuters.
A Canadian TV news channel said GM was planning to close all operations at the plant in Oshawa, near Toronto.
GM has been cutting jobs to deal with plunging car sales in North America and has been debating for months how to address shrinking car demand, a person briefed on the matter said.
GM is expected to announce as soon as this week some involuntary salaried layoffs after it did not get as many volunteers to accept buyouts as hoped.
The stepped up cost-cutting and restructuring at GM comes as many industry executives and analysts predict that overall vehicle sales in the United States will decline further in 2019 and 2020.
GM employs about 2,500 union staff in Oshawa which produces both the Chevrolet Impala and Cadillac XTS sedans. It also completes final assembly of the stronger-selling Silverado and Sierra pickup trucks which are shipped from Indiana.
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General Motors Co. plans to close its manufacturing operations in the Canadian city of Oshawa, according to people familiar with the plans, the latest in a series of cost-cutting moves under way at the Detroit car maker.
The move will affect roughly 2,800 workers in Oshawa, just east of Toronto, where GM now builds pickup trucks and large sedans, and comes as the Canadian auto sector is struggling to preserve jobs and attract new investment.
Two people said GMs factory operations in Oshawa would close down before the end of 2019. The move is part of a global restructuring for GM that involves moving toward hybrid and low-emissions vehicles and will also affect plants in other countries, one person said.
Cadillac Cancels $1,800-a-Month Car-Subscription Service (Nov. 2) GM is in cost-cutting mode amid signs of a slowdown in each of its largest markets, China and the U.S. The company recently offered buyouts to more than one-third of its 50,000 salaried employees in North America, citing the need for belt-tightening, while the economy and car market remain relatively strong.
Canadas auto industry, which is concentrated in southern Ontario, has shrunk over the past decade, as more factories moved to the southern U.S. and Mexico where labor costs are cheaper. Canadian policy makers had hoped the United States-Mexico-Canada Agreement—reached in late September with provisions requiring more work be done by higher-wage workers—would help the domestic industry.
Today, Canada is among the most expensive countries in the world to build cars and the highest-cost market for car assembly in the North American free trade zone.
Unifor, the union representing Canadian auto workers, said in a statement that it had received notification that GM will make a major announcement on Monday that will impact its global operations.
While the union does not have complete details of the overall announcement we have been informed that, as of now, there is no product allocated to [GMs] Oshawa assembly plant past December 2019, the Unifor statement said.
The union reached an agreement on a new four-year contract with GM in 2016 that included new investment in the Oshawa factory, spurring hope among workers that the plants future would be secure.
GMs Oshawa assembly plant first opened in 1953 and produces the Cadillac XTS, Chevrolet Impala, Chevrolet Silverado and GMC Sierra, according to the companys website. The factory employs about 2,500 people, and another 300 employees work in other GM divisions in the city, Oshawas departing mayor John Henry said.
A closure of the Oshawa plant would have an immediate effect on the citys economy, said Mr. Henry. Youd be hard pressed to find somebody in Oshawa that doesnt have a tie to General Motors.
Union and local officials at some of GMs U.S. factories are concerned their plants could be slated for closure, too. Officials at the United Auto Workers local chapter that represents workers at GMs plant in Lordstown, Ohio, organized a rally last week to underscore the importance of the plant to the local economy, a union official said.
Industry analysts have said GM has too many underused assembly plants in the U.S., even after shuttering several factories after bankruptcy. GM executives in recent years have considered closing one or two of its factories, including Lordstown, people familiar with the matter have said.
In less than two years, GM has cut two of its three work shifts at Lordstown amid sliding sales of the Chevrolet Cruze compact sedan built there. Sedan sales have declined across the industry amid a consumer shift toward sport-utility vehicles.