The end of GM’s Oshawa plant: What we know so far

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The latest

• Automotive company Martinrea International Inc. says it plans to close a factory that makes parts for the cars rolling off the assembly line in Oshawa, Ont., a ripple effect from GM’s announcement on Monday that it will shut the plant next year. 
• The Oshawa plant will be one of five North American facilities scuttled in 2019, the U.S. auto giant confirmed Monday. GM’s changes are part of a worldwide shift to electric and self-driving cars, and an acknowledgement that U.S. consumers are buying fewer cars than they used to. Here’s a primer from The Globe and Mail’s Ian McGugan on the economic challenges GM and the auto industry face.
• Workers at the General Motors plant in Oshawa, Ont., returned to work Tuesday after news of the facility’s closing prompted walkouts the day before. Their union, Unifor, has denounced the plant’s demise and called on GM to stand by a 2016 bargaining agreement to keep jobs there. 
• U.S. President Donald Trump threated to cut all GM subsidies including for its electric-cars program on Tuesday in a tweet, shortly after speaking with Prime Minister Justin Trudeau by telephone. The two vowed to work together to help auto workers. GM has not recently taken advantage of Canadian subsidies. Ottawa took a  more measured tone, with Mr. Trudeau and Ontario Premier Doug Ford saying they were disappointed but focused on supporting workers who were losing their jobs.

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What GM is doing and why

• When the Oshawa plant is closing: GM’s Monday statement didn’t use the word “close,” instead saying that, as of 2019, the Oshawa plant and several others would be “unallocated,” meaning no products are assigned to be made there. Sources have confirmed to The Globe that the Oshawa plant will indeed be shut down.
• What U.S. plants are closing: In addition to the Oshawa closing, GM says it has no plans to make automobiles at two other factories – one in Warren, Ohio, and the Detroit-Hamtramck plant in Michigan – as well as parts plants in White Marsh, Md., and Warren, Mich. Two unnamed plants outside North America would also be affected, as well as previously planned cuts in South Korea, the company said.
• How many jobs are affected: GM’s layoffs and buyouts could endanger up to 14,700 factory and white-collar workers' jobs in North America. The GM plant in Oshawa employs 2,522 unionized workers and is also GM’s Canadian headquarters.
• What models are being phased out: Several vehicle models that were made at the scuttled plants will be discontinued, including the Chevrolet Cruze, Cadillac CT6 and Buick LaCrosse.
• Why this is happening: The changes are part of a shift in the company’s global production toward autonomous and zero-emission vehicles, Mary Barra, GM’s chief executive officer, said at a Monday news conference. "The actions we are taking today continue our transformation to be highly agile, resilient and profitable, while giving us the flexibility to invest in the future,” she said. The company expects to save US$6-billion from the cutbacks.

GM assembly or propulsion

plants in North America

Oshawa

401

PARK RD. S.

The Oshawa

Assembly

Plant opened

in 1953 and

employs 2,522

workers

Employees

P. MURRAY AVE.

0

500

Lake Ontario

M

Flint, Mich.

UNITED STATES

Fort Wayne, Ind.

Fairfax,

Kan.

Spring Hill,

Tenn.*

Wentzville,

Mo.

Arlington, Tex.

Employees

Note: General Motors also

has plants in Mexico at

Ramos Arizpe, Silao, San

Luis Potosi and Toluca for

which employee information

was not available.

1,000

2,000

3,000

4,000

5,000

*Assembly and propulsion

JOHN SOPINSKI and murat yükselir/THE GLOBE

AND MAIL SOURCE: gm authority; gm corporate

newsroom

GM assembly or propulsion plants

in North America

Oshawa, Ont.

Flint, Mich.

U.S.

Employees

1,000

Fort Wayne, Ind.

2,000

Fairfax,

Kan.

3,000

Spring Hill,

Tenn.*

Wentzville,

Mo.

4,000

5,000

Oshawa

401

Arlington, Tex.

PARK RD. S.

MEXICO

The Oshawa

Assembly

Plant opened

in 1953 and

employs 2,522

workers

Note: General Motors also

has plants in Mexico at

Ramos Arizpe, Silao, San

Luis Potosi and Toluca for

which employee information

was not available.

P. MURRAY AVE.

0

500

Lake Ontario

Employees

*Assembly and propulsion

M

JOHN SOPINSKI and murat yükselir/THE GLOBE AND MAIL

SOURCE: gm authority; gm corporate newsroom

GM assembly or propulsion plants in North America

Oshawa, Ont.

Flint, Mich.

Employees

UNITED STATES

1,000

Fort Wayne, Ind.

2,000

Fairfax,

Kan.

3,000

Wentzville,

Mo.

Spring Hill,

Tenn.*

4,000

5,000

Oshawa

401

Arlington, Tex.

PARK RD. S.

The Oshawa

Assembly

Plant opened

in 1953 and

employs 2,522

workers

MEXICO

Note: General Motors also

has plants in Mexico at

Ramos Arizpe, Silao, San Luis

Potosi and Toluca for which

employee information was

not available.

P. MURRAY AVE.

0

500

*Assembly and propulsion

Lake Ontario

M

JOHN SOPINSKI and murat yükselir/THE GLOBE AND MAIL

SOURCE: gm authority; gm corporate newsroom

The unions' response

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In a heated press conference Monday afternoon, president of Unifor Jerry Dias called the announcement a “betrayal," adding that “they are not closing our damn plant without one hell of a fight.” Canada’s largest private-sector union also urged GM to live up to the spirit of a 2016 agreement to save jobs in Oshawa by upgrading an assembly line. That deal, which averted a strike by GM workers, was hailed at the time by Mr. Dias as a commitment to prevent the plant’s closing in 2019.

Mr. Dias met with Mr. Trudeau on Tuesday to discuss the implications of the GM plant closing in Oshawa, saying the company has moved production of five models of vehicles to Mexico and the United States in the past few years, and if the Oshawa plant closes, the company will have only one left here. He says labour standards in Mexico are low and Trudeau has to work with Mr. Trump to keep manufacturing jobs from shifting south.

The biggest U.S. autoworker union also vowed to fight GM’s plans on Monday. “General Motors’ decision today ... will not go unchallenged by the UAW,” said Terry Dittes, the United Auto Workers' vice-president in charge of negotiations with GM.

Politicians' response

Federal: Prime Minister Justin Trudeau vowed Monday that Ottawa would offer help to affected workers and their families, adding that he told GM’s CEO he was disappointed in their move. Later Monday, Innovation Minister Navdeep Bains told a news conference in Ottawa that the Trudeau government is “more than willing to work with the province and work with the municipal leadership to see what we can do for the workers.” Mr. Trudeau later tweeted that he spoke to Ontario Premier Doug Ford and that they are “united in support” for workers in Oshawa, Ont.

Provincial: The Ontario government will bolster unemployment insurance coverage, from 45 weeks to 50, in all regions affected by the plant closing, Mr. Ford said Monday. He also said he asked GM in a phone call if there was anything Ontario could do to keep the Oshawa plant open, and was told it could not.

The local MPP for Oshawa, New Democrat Jennifer French, also called the news “gravely concerning.”

Municipal: Oshawa Mayor John Henry said he had not spoken to anyone from GM. He said he heard about the reported closing from CTV News, which first reported the story, when a reporter called him for comment earlier in the day. In a phone interview with The Canadian Press, he said that the plant closing would have ripple effects well beyond the city:

Presidential: U.S. President Donald Trump said on Monday he was not happy with GM’s decision to idle the plant in Ohio, a state where, at a rally a year earlier, he famously promised that factory jobs were “all coming back. Don’t move. Don’t sell your house.” On Monday, Mr. Trump said GM had “better put something else” in the state. He also told the Wall Street Journal GM should stop making cars in China and make them in the United States instead. He said he told Ms. Barra to “get a car that is selling well and put it back in” Ohio. Tuesday, more than 24 hours after the official announcement, Mr. Trump tweeted his disappointment, saying the government is looking at cutting all GM subsidies.

Congressional: In Ohio, both Senate and House politicians denounced the move as corporate greed, and some took direct aim at Mr. Trump. Democratic Representative Tim Ryan, whose district includes Lordstown, said in a statement the community deserves accountability from the President:

Oshawa and GM: A history

Oshawa’s rise

The news of GM scuttling the Oshawa plant comes 100 years after the U.S. auto-making giant first landed in the community, acquiring the McLaughlin family’s car-manufacturing business in 1918.

The McLaughlins had started making horse-drawn sleighs and carriages in the 19th century and switched to Buick and Chevrolet production in the 1900s. Sam McLaughlin was made the first president of General Motors of Canada Ltd., and under his tenure the company grew quickly, with Oshawa as the export manufacturing base supplying the British Commonwealth. When the car boom of the mid-20th century came, Oshawa was poised to take advantage of the growing demand. By the 1980s, the GM Autoplex was one of the planet’s largest car assembly plants and employed 23,000 people.

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GM’s fall

Even before the 2007-08 financial crisis, GM had been whittling down its operations in Oshawa, scuttling one of its plants in 2005 and cutting 3,750 jobs. Then disaster struck: The recession sent car purchases plummeting, oil prices rose and GM’s Canadian production shrank.

General Motors Corp. filed for bankruptcy protection in 2009. A multibillion-dollar bailout made the U.S., Canadian and Ontario governments part-owners of the company. More cuts came under the so-called Government Motors era, and thousands more jobs were lost when Oshawa’s consolidated plant was closed. In all, Ottawa gave $7.23-billion to GM, and the province $3.6-billion, and when both governments unloaded their GM shares in 2015, they lost about $3.5-billion on their taxpayer-funded investment.

More reading: A history of General Motors in Canada

What will GM do next?

GM’s market share has been in decline, and its share of Canadian light-vehicle production has never recovered to its levels from before the 2009 bankruptcy. With demand waning for traditional sedans, all auto makers are under pressure to change the kinds of vehicles they make. GM is now beginning what is expected to be a long and expensive transition to an entirely new business model, one that embraces electrified and automated vehicles, many of which will be shared rather than owned.

Moving into the electric market will be a costly and painstaking process, The Globe’s Ian McGugan explains: Analysts predict auto makers will need to invest heavily to develop the technologies they need. The industry is still profitable for now, but U.S. economic growth is slowing and consumers are expected to buy fewer cars in the future. GM’s cost-cutting may help them to clear those hurdles and enter an electric future, but as Mr. McGugan writes, it “also underlines doubts about whether the industry can return to robust health.”

What will Oshawans do next?

Losing thousands of jobs will shake the economic balance of Oshawa, a town of 166,000 that’s been trying to grow out of its postindustrial malaise. Public infrastructure projects and a real-estate boom for Ontarians priced out of the Toronto market have improved the city’s fortunes in recent years, but GM remained the city’s No. 1 private-sector employer.

The town is also grappling with pervasive problems of economic inequality that the loss of GM jobs can only make worse. Oshawa’s downtown unemployment rate is nearly twice its region’s average, and there are pockets of deep poverty and homelessness in its inner suburbs. Earlier this year, The Globe’s Marcus Gee took a deeper look at Oshawa’s two realities in a tour of “Tarp Mansion,” an encampment for homeless people by a local creek, where anti-poverty activists spoke with him about the growing disparity between the haves and have-nots.

Commentary and analysis

Sunil Johal: GM’s closing is a warning shot: Canada’s not ready for the age of disruption

Barrie McKenna: Media frenzy overstates significance of GM’s Oshawa plant closing

Konrad Yakabuski: The GM paradox: Sell more pick-ups, prepare for an electric car world

Campbell Clark: After GM's Oshawa plant closure, the Liberals' industrial strategy is losing its credibility

Editorial: No bailout can save Oshawa from GM's hard reality

Barrie McKenna: On the GM bailout, we got what we paid for

Eric Reguly: What just happened with the Oshawa plant closing? Trump happened, it appears

Compiled by Globe staff

With reports from Josh O’Kane, Eric Atkins, Robert Fife, Reuters, Associated Press and The Canadian Press, and reporting from The Globe and Mail archives by Greg Keenan, Thandiwe Vela and Marcus Gee

Editor’s note: A previous version of this story incorrectly said Unifor was Canada's largest public-sector union. In fact, it is Canada's largest private-sector union. This version has been corrected.