GM to lay off 1,300 workers at Oshawa assembly line as U.S. strike continues

The strike by 49,000 General Motors Co. workers in the United States has caused the layoffs of 1,300 employees at the automaker’s pickup-truck assembly line in Oshawa, Ont.

The layoffs, which GM said are temporary, underline the interconnectedness of the North American auto sector, which relies on supplies of just-in-time parts from cross-border suppliers.

Unifor president Jerry Dias said he expects the second line at the Oshawa plant to also be disrupted because of a lack of parts from the U.S. as early as Thursday to leave all 2,600 workers at the plant off the job.

The Oshawa plant assembled GM pickup trucks with U.S.-made parts. The assembly line is to close in December.

The three-day-old strike by GM’s United Auto Workers has idled more than 50 U.S. factories and warehouses. Negotiations were continuing Wednesday. UAW spokesman Brian Rothenberg said the talks were moving slowly, but progressing.

GM, which employs 7,000 people in Ontario, said on Wednesday its plants in St. Catharines, Ont., and Ingersoll, Ont., are unaffected so far.

Mr. Dias said he expects about two-thirds of GM’s Cami plant in Ingersoll to shut down by early next week because of the strike, while its St. Catharines operation could be hit by the middle of next week. Workers at those plants will still be compensated in a shut down, but not as fully as the Oshawa workers.

Ontario’s auto-parts makers, which export $18-billion a year in components to the U.S. and employ 100,000, are expected to also be increasingly affected by the strike.

Martin Transportation Systems Inc., a trucking company that serves GM, laid off 100 workers this week as result of the shutdown.

Peter Sklar, a stock analyst at Bank of Montreal, said it is difficult to characterize the strike’s effects on Ontario auto-parts makers, because GM is later expected to run overtime shifts to make up for lost production. However, he said if the stoppage continues, suppliers may have to lay off workers.

“We believe the duration of this strike may be prolonged as GM is prioritizing cost reduction in order to prepare for the downturn of the auto cycle, which we believe could materialize at any time,” Mr. Sklar said. The strike gives rivals Ford Motor Co. and Fiat Chrysler Automobiles NV a chance to win new market share, although the integrated nature of the auto-making supply chain – and, in some cases, common parts – means the other two Detroit car makers could be negatively affected, Mr. Sklar said.

Ontario-based parts makers Magna International Inc., Linamar Corp. and Martinrea International Inc. did not respond to requests for comment.

With files from The Canadian Press

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