General Motors Co. will keep one of its two Oshawa, Ont., assembly plants open two years longer than expected, the company announced Thursday.
The move is designed to meet projected demand for the Chevrolet Impala and Chevrolet Equinox models, which are assembled at the consolidated plant in Oshawa. The consolidated plant assembles an older version of the Impala for fleet customers, while the neighbouring flexible plant builds the redesigned 2014 model of the full-sized sedan.
The consolidated plant was originally scheduled to close in August, 2014.
GM agreed during contract talks with the Canadian Auto Workers union last fall to extend production to 2014 using one shift of workers. That was a year later than the plant's original closing date of 2013.
The move will preserve about 700 jobs at the consolidated plant through 2016.
"What it means for us is a little bit of stability," said Ron Svaljenko, president of local 222 of Unifor, as the union representing workers at GM Canada is now called.
The extension also means the plant stays in the battle for allocation of new product, which would keep it open beyond the new scheduled closing date of 2016, Mr. Svaljenko said.
The two plants now employ about 3,500 people.
The extension of production should also remove doubts about whether GM Canada would meet production commitments it made to the federal and Ontario governments when they contributed $10.8-billion of taxpayers' money to bail out General Motors Co., in 2009. The production commitment expires in 2016.