Tony Leah, GM worker and member of Green Jobs Oshawa Coalition speaks to activists and media outside the General Motors plant in Oshawa, Ont., on the final of production on December 18, 2019. The last vehicles of an era rolled out of GM Canada’s Oshawa assembly plant last week, but workers and the union behind them hope it’s not the end of the line. “We shouldn’t let go of the manufacturing capacity we have there,” said Tony Leah, who worked at the plant for 39 years before having to retire in early December. He’s part of a campaign advocating for government to take over the plant and produce electric vehicles. THE CANADIAN PRESS/Aaron Vincent Elkaim

Tony Leah, GM worker and member of Green Jobs Oshawa Coalition speaks to activists and media outside the General Motors plant in Oshawa, Ont., on the final of production on December 18, 2019. The last vehicles of an era rolled out of GM Canada’s Oshawa assembly plant last week, but workers and the union behind them hope it’s not the end of the line. “We shouldn’t let go of the manufacturing capacity we have there,” said Tony Leah, who worked at the plant for 39 years before having to retire in early December. He’s part of a campaign advocating for government to take over the plant and produce electric vehicles. THE CANADIAN PRESS/Aaron Vincent Elkaim

The unclear path forward for Canada’s auto sector as the electric age approaches

Estimates say automakers globally will be spending US$255 billion to roll out 207 electric models by 2022

The last vehicles of an era rolled out of GM Canada’s Oshawa assembly plant last week, but workers and the union behind them hope it’s not the end of the line.

“We shouldn’t let go of the manufacturing capacity we have there,” said Tony Leah, who worked at the plant for 39 years before having to retire in early December. He’s part of a campaign advocating for government to take over the plant and produce electric vehicles.

The end of production at the plant, which assembled vehicles such as the GMC Silverado and Chevy Impala in the final years of its 66-year run, comes at a time of change and uncertainty in the auto industry as it grapples with slowing sales, trade disputes and the steep costs of transitioning production to electric and autonomous vehicles.

Analysts say that in this environment, there’s no clear path ahead for the Oshawa facility or Canada’s auto sector more generally, and it will have to be prepared to fight for the next generation of product commitments needed to sustain itself.

“It’s a very difficult task that Canada has,” said Joe McCabe, president of AutoForecast Solutions.

“But if they focus on the next evolution of the industry, which is this electrification and autonomy, I think that’s a stronger, long-term sustainable play for the Canadian space.”

McCabe sees conventional auto production in Canada as stable at best going forward, if not declining. The sector has already seen cutbacks in the past year at Ford’s Oakville, Ont., plant, Fiat Chrysler’s Windsor, Ont., plant, and of course GM’s Oshawa assembly plant.

He said the best bet for a major investment could be a new entrant, maybe from China, looking to get a North American foothold, but that it will take hard work and big money to lure a new plant to the province.

“The manufacturers have to be incentivized somehow to want to put that flag there.”

ALSO READ: No crude, but still rude: BC Hydro survey reveals conflict at electric vehicle charging stations

China-based Johnson Electric committed in late 2017 to invest more than $350 million in new equipment and capacity in the province focused largely on electric vehicle components, while the Ontario government agreed to chip in $24.1 million. BYD Co. Ltd. also committed to building electric buses in Ontario at the time, though financial details weren’t disclosed.

U.S. investments, meanwhile, will be hard to come by in the near term, said Kristin Dziczek, vice president of industry, labour and economics at the Center for Automotive Research.

“Right now, investments of any type, in the political environment we’re in, any investment outside the U.S. draws scrutiny.”

But while Canada’s auto industry hasn’t seen the major investments made in the U.S., like GM’s announcement of a US$2.3-billion battery plant in Ohio and billions of dollars to build an all-new electric pickup truck in Detroit, it should still see increases in electric production, said Dziczek.

Most companies will be ramping up from very low levels, while Toyota is expected to have the most production with a 77 per cent increase to 107,000 units by 2023.

The company says hybrid models of its RAV4 and Lexus RX already account for more than 20 per cent of its Canadian production, and that it will also start producing the Lexus NX hybrid in 2022.

“We’ve made significant investments in our facilities to enable them to produce electrified vehicles,” said Stephanie Pollard, vice president of Toyota Motor Manufacturing Canada, in a statement.

Green Jobs Oshawa, the group Leah is a part of, would like to see the Oshawa plant also get into the electric race, with an aim to produce about 150,000 electric vehicles over five years focusing on postal trucks and other federal vehicles.

While great in theory, the chances of it happening are slim to none, said Unifor president Jerry Dias.

“That would be wonderful, but it’s not going to happen.”

Instead, Dias is focused on making sure GM maintains the integrity of the plant and invests in the test track it has promised, so the plant is ready for potential future production that could be lured there by the advanced infrastructure in the area.

“If GM is going to have a test track to use to test out their autonomous and electric vehicles, that will be designed and engineered in Markham, the natural next step is, why wouldn’t you build a car?”

GM has committed $170 million to transform the plant into an auto parts manufacturing operation and build the track, but it hasn’t made any commitments to future vehicle production. It has focused lately more on its technology research and development in the region.

“In times of change, it’s best to focus on the future,” said Scott Bell, president and managing director of GM Canada in a letter on the plant’s closure.

Electric vehicle commitments are just one of the many issues Dias will take into contract negotiations next year with the Detroit three automakers. Electric vehicles remain a sliver of the market, and could still be only about five per cent of sales in 2025, according to Unifor’s estimates.

But it will certainly be an increasingly pressing issue going forward. Management consultant AlixPartners estimates automakers globally will be spending US$255 billion in research, design and capital expenditures and roll out some 207 electric models by 2022.

“It’s inevitable, it’s happening, and so you want to be on the forefront of that, you don’t want to be lagging behind,” said Dias.

He said government will need to work with industry to lure new commitments for the next generation of automobile assembly to keep a bedrock of Ontario’s economy healthy.

“All of the auto companies are talking about the inevitable transformation, and I agree with them, there will be an inevitable transformation. The question becomes, what’s Canada’s role in the transformation.”

Ian Bickis, The Canadian Press


Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Interior Health reported 79 new cases of COVID-19 and two new death in the region Friday, Jan. 22, 2021. (Ben Hohenstatt/Juneau Empire)
79 new COVID-19 cases, two deaths reported in Interior Health

Both of Friday’s deaths were both recorded at long-term care homes

Esk’etemc First Nation (Alkali Lake) Chief Fred Robbins takes part in Secwepemc Health Caucus’s “Raising Our Spirits” ceremony Friday, Jan. 22. (Secwepemc Health Caucus Facebook image)
Secwepemc Nation raises spirits through song

More than 150 join virtual ceremony

Susan Hill with her dog Sadie enjoy a brisk walk this week at Scout Island where the lake is beginning to freeze over as overnight and daytime temperatures remain well below zero. (Monica Lamb-Yorski photo - Williams Lake Tribune)
Overnight lows of -18C in the forecast for Williams Lake Friday

Colder temperatures will persist through the weekend and next week

Email editor@wltribune.com
LETTERS: Worship can take place outside of churches

Williams Lake city council needs to mind its own business

Toronto Public Health nurse Lalaine Agarin sets up for mass vaccination clinic in Toronto, Jan. 17, 2021. B.C. is set to to begin its large-scale immunization program for the general public starting in April. THE CANADIAN PRESS/Frank Gunn
B.C.’s COVID-19 mass vaccinations expected to start in April

Clinics to immunize four million people by September

Sunnybank in Oliver. (Google Maps)
Sunnybank long-term care in Oliver reports third COVID-19 death

The facility currently has an outbreak with 35 cases attached to it

Cannabis bought in British Columbia (Ashley Wadhwani/Black Press Media)
Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

Chief Public Health Officer Theresa Tam speaks during a daily briefing in Ottawa. (THE CANADIAN PRESS/Adrian Wyld)
31 cases of COVID-19 variants detected in Canada: Health officials

Dr. Theresa Tam made announces 13 more variant COVID-19 cases in Canada

Royal Inland Hospital in Kamloops. (Dave Eagles/Kamloops This Week file photo)
COVID-19 outbreak declared at Kamloops’ Royal Inland Hospital surgical unit

Despite 6 South being a surgical unit, RIH said surgeries are continuing at the hospital

Daily COVID-19 cases reported to each B.C. health region, to Jan. 20, 2021. Island Health in blue, Northern Health green, Interior Health orange, Vancouver Coastal in red and Fraser Health in purple. (B.C. Centre for Disease Control)
B.C.’s COVID-19 infection rate stays stable with 508 cases Friday

Vaccine delivered to more than 110,000 high-risk people

The District of Saanich’s communications team decided to take part in a viral trend on Thursday and photoshopped U.S. Senator Bernie Sanders into a staff meeting photo. (District of Saanich/Twitter)
Bernie Sanders makes guest appearance municipal staff meeting in B.C.

Vancouver Island firefighters jump on viral trend of photoshopped U.S. senator

School District 57 headquarters in Prince George. (Mark Nielsen, Local Journalism Initiative Reporter)
Prince George school district settles with sexual abuse victim

Terms were part of an out-of-court settlement reached with Michael Bruneau, nearly four years after he filed a lawsuit

Surrey provincial court. (File photo: Tom Zytaruk)
New COVID-19 protocols set for provincial courthouses

The new rules were issued on Jan. 21, and took effect immediately

Most Read