A sign stands outside Oshawa's General Motors car assembly plant in Oshawa, Canada.Michelle Siu/The Canadian Press
The life of a General Motors Co. plant in Oshawa, Ont., has been extended into 2017 amid hot sales of one of the vehicles it assembles.
The consolidated plant, which was scheduled to close in mid-2016, will continue turning out Chevrolet Equinox compact crossovers after a $12-million investment in that factory and GM's Cami plant in Ingersoll, Ont., which is the home plant for the Equinox and its GMC twin, the Terrain.
It is the fifth time that the consolidated plant has been given an extended lease on life. The closing originally was announced in 2005 and scheduled to occur in 2008.
"This new investment represents a very effective way for us to meet strong demand for the Chevrolet Equinox," GM Canada president Steve Carlisle said in a statement.
What happens beyond 2017 at the consolidated plant and the neighbouring flexible plant will depend in part on what happens in contract negotiations next year between the company and Unifor, the union that represents workers in Oshawa and a GM engine and transmission plant in St. Catharines, Ont., as well as those at Cami.
The extension of the consolidated plant is good news, Unifor president Jerry Dias said, but unless new vehicles are allocated to the flexible plant, the chances of GM and Unifor reaching an agreement are "nil."
Negotiations next year with GM and its Detroit Three rivals, Ford Motor Co. and Fiat Chrysler Automobiles NV, will be difficult, Mr. Dias said, but new vehicles for Oshawa are critical. "That is going to be the key piece," he said.
The consolidated plant and Cami are about two hours apart along Highway 401 in Southern Ontario, but are linked by a so-called shuttle operation.
The body shop at the Cami plant produces more Equinox bodies than Cami has the capacity to paint and finish. So the unfinished bodies are sent to Oshawa, where they are painted and finished with interiors and other components.
"We are booming here," said Mike Van Boekel, chair of the Cami unit of Local 88 of Unifor. The plant has been running on three shifts a day, six days a week for the past six years.
About 20 workers are being hired on average every three months, Mr. Van Boekel added.
The Equinox is GM Canada's third-highest-selling vehicle, although sales fell about 10 per cent in the seven months ended July 31 to 11,142 from 12,382 in the first seven months of 2014.
Sales in the U.S. market, which is the destination for about 90 per cent of Equinox models, rose 15 per cent in the first seven months of the year. The compact crossover segment is among the hottest market niches on both sides of the border.
The Oshawa consolidated plant also produces older versions of the Chevrolet Impala mid-sized car. The newer versions of the Impala are produced at the neighbouring Oshawa flexible plant, which also turns out the Buick Regal, Chevrolet Camaro and Cadillac XTS.
Camaro production is scheduled to end in November, while Impala, Regal and XTS are scheduled to end or be moved elsewhere. The shift in Camaro production will eliminate about 1,000 of the 3,700 jobs at the two Oshawa plants.
The lack of new product allocation has raised fears about the future of the Oshawa operations later this decade.
Mr. Carlisle said earlier this year that no decisions on future product allocations for Oshawa would be made until after the auto maker concludes the labour negotiations next year.