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GM to unveil R&D plans to meet bailout conditions

Workers on General Motors 'flex line' build automobiles in Oshawa, Ont. June 10/2011.

Kevin Van Paassen/Kevin Van Paassen/The Globe and Mail

General Motors of Canada Ltd. will spend several hundred million dollars on R&D projects by 2016 to meet the conditions of its 2009 bailout.

The auto maker has scheduled a news conference at its Oshawa, Ont., regional engineering centre for Tuesday, where it will outline plans to meet commitments it made to the federal and Ontario governments, which together contributed $10.5-billion to the bailout.

Both Prime Minister Stephen Harper and Ontario Premier Dalton McGuinty will speak at the event.

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One of the promises GM Canada made to the two governments in 2009 was that it would spend about $1-billion on research and development projects between then and 2016.

The company was spending about $25-million annually on research and development in Canada at the time, sources said, and the governments won a much bigger commitment.

The projects to be initiated or expanded between now and 2016 are expected to focus on environmental technologies, electric vehicles, vehicle weight reduction and so-called intelligent transportation systems.

There are several such projects under way at various Ontario universities, including research into two battery-powered versions of the Chevrolet Equinox crossover utility vehicle, which is assembled at GM's Cami Automotive Inc. plant in Ingersoll, Ont.

Reducing vehicle weight is a key goal of all auto manufacturers as governments introduce more stringent fuel economy requirements. "It isn't just metals," such as finding ways to use more aluminum and magnesium instead of steel in a car, said one research and development expert.

Some research focuses on where electronic systems can replace the traditional wire controls.

As part of its 2009 commitments, GM Canada also agreed that its Canadian plants would produce 16 per cent of the vehicles General Motors Co. assembled in North America between 2009 and 2016.

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It also promised to begin building a fuel-efficient transmission at its St. Catharines, Ont., operation and to start assembly of five new vehicles in Oshawa or Ingersoll during the same period.

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