GM Agrees to Reopen Oshawa Plant in Deal with Union

(This story has been updated with additional information from GM CEO Mary Barra.)

General Motors will begin building heavy-duty pickup trucks at the shuttered assembly plant in Oshawa, Ontario, under the terms of the tentative agreement with Unifor, the union representing Canadian autoworkers.

Jerry Dias, Unifor president, said the agreement reached after the original strike deadline was extended, represented a major victory for the union and the Canadian auto industry. Under the agreement, GM expects to invest $1 billion in Oshawa to prepare it for resumption of heavy-duty pickup truck production in January 2022.

The agreement reverses the plant closing GM announced in 2018 and calls for adding a second shift in 2022 and possibly a third shift, which would bring employment to 2,500 people. Dias said he expects work will begin on renovating the Oshawa complex as soon as the contract is ratified, something that GM CEO Mary Barra confirmed during a conference call with analysts and media, saying “we will move very quickly upon ratification” of the contract. The ratification vote is set for Sunday, he added.

(Unifor reaches tentative deal with GM after extending old contract to keep talking.)

“We never gave up hope,” said Dias, recalling GM’s announcement in November 2018 when the automaker announced plans to shutter the plant as part of a broad restructuring that also led to closure of GM’s assembly plant in Lordstown, Ohio.

During an earnings call with analysts and media earlier today, Barra said the move to resume truck production in Oshawa was born out of necessity.

“We have been operating our full-size pickup plants around the clock to meet exceptionally robust demand for the Chevrolet Silverado and the GMC Sierra in the United States and Canada,” she said. “The fact is we simply can’t build enough. And because we expect demand to remain strong, we must increase our capacity.”

(GM delivers unexpectedly strong Q3 earnings but Wall Street remains cautious.)

GM also agreed to make major investments in the engine and transmission plant in St. Catherine’s, Ontario, Dias said. “This is an absolute home run,” he said.

Dias noted the two sides were close to an agreement as the strike deadline approached but had not put the final elements of the proposed contract in place. Walking away from the table at midnight would have disrupted efforts to reach an agreement, he said.

Dias also told reporters that he expected both the Ontario Provincial government and the Canadian federal government of Prime Minister Justin Trudeau to help finance the renovations of both the Oshawa complex and the St. Catherine’s plant.

(Oshawa Plant’s fate may be hang up in GM, Unifor talks.)

Both Ontario and the government in Ottawa have already announced commitments to help with renovations of the Fiat Chrysler Automobile N.V. plant in Windsor and the Ford Motor Co. plant in Oakville, Ontario, after Unifor negotiated major investment at both sites during negotiations with Detroit’s automakers, Dias noted.