General Motors to phase down operations in Oshawa

Anna Jefferson
November 27, 2018

Trump said he'd been told that the Chevrolet Cruz model was failing to sell, "but hopefully she's going to come back and put" a different model in.

The factories up for closure are part of GM's effort "to right-size our capacity for the realities of the marketplace", as consumers shift away from cars to trucks and SUVs, Barra said. "USA will soon have a level playing field, or better", Trump tweeted in August.

Both U.S. Senators Sherrod Brown and Rob Portman have lobbied GM CEO Mary Barra to bring a new product to the Lordstown plant. Barra said the company will double resources dedicated to electric and self-driving vehicles over the next two years. "These are things we are doing to strengthen our core business".

At GM's Detroit headquarters on Monday, there were signs directing people to a "new hire orientation" meeting. Shares of Detroit rivals Ford Motor Co and Fiat Chrysler Automobiles NV also rose, outpacing the broader market.

GM said it would shut operations at plants in Detroit; Oshawa, Ontario; Warren, Ohio; White Marsh, Maryland; and Warren, Michigan.

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Lagging U.S. vehicle sales has seen several auto plants fall to just one shift, including its Detroit Hamtramck Assembly plant and Lordstown, Ohio, assembly plant. The Chevy Volt plug-in hybrid will also be dropped along with the Chevy Cruze compact, which will be made in Mexico for other markets. If the report is true, the move will affect at least some 2,500 workers, plus others in related spheres, such as auto parts productions. Also affected are transmission factories in Warren, Michigan, as well as Baltimore.

The cuts will happen during the remainder of the year and the first quarter of 2019.

In October, almost 65% of new vehicles sold in America were trucks or SUVs. The expenditures to bring those vehicles to production will start to hit with new batteries and body architectures created to generate profits.

"If GM Canada is indeed turning its back on 100 years of industry and community ― abandoning workers and families in Oshawa ― then this is a callous decision that must be fought", she told the network. GM has several plants running well below that.

The company has said the additional tariffs have cost GM more than $1 billion.

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Altogether, GM has five vehicle factories with plenty of unused capacity in Kansas City, Kansas; Lordstown; and Detroit-Hamtramck, Lansing, and Orion Township, Michigan.

In January 2017, General Motors announced the elimination of the third shift at the Lordstown Complex due to what the company says was a change in buyer preference from small cars to trucks and crossover vehicles. GM wouldn't disclose how many employees have accepted the buyout.

On Sunday, the mayor told The Canadian Press that he hopes reports of the closure are "just a rumor".

In the United States, Trump's economic adviser, Larry Kudlow, was scheduled to meet with Barra on Monday.

GM, the largest automaker in the USA, which sells the Chevrolet, Buick, Cadillac and GMC brands, said the moves will save $6 billion in cash by the end of next year, including $4.5 billion in recurring annual cost reductions and a $1.5 billion reduction in capital spending.

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As part of a "staffing transformation", the firm is also aiming to reduce its workforce by around 15% - about 18,000 jobs - which it says will include cutting 25% of its executive staff. GM expects the move to reduce costs by around £3.5 billion.

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