General Motors has confirmed it will close its Oshawa assembly plant and four other facilities in the United States next year, as part of a global restructuring of the company.
The auto giant made the announcement that will cost thousands of people their jobs on Monday. The Oshawa facility, as well as the Detroit-Hamtramck Assembly in Detroit, Lordstown Assembly in Warren, Ohio, Baltimore Operations in White Marsh, Maryland, and Warren Transmission Operations in Warren, Michigan will all be shut down.
The move comes as GM shifts focus to electric and autonomous vehicle programs, vowing to double the amount of resources allocated in those areas within the next two years. The steps will also improve "overall business performance" by reorganizing global product development staffs, realigning manufacturing capacity, and reducing the salaried workforce, GM said.
“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,” said GM Chairman and CEO Mary Barra, in a statement. “We recognize the need to stay in front of changing market conditions and customer preferences to position our company for long-term success.”
GM said it estimates that the changes announced Monday will save the company $6 billion by the end of 2020.
The auto manufacturer is also cutting its salaried and salaried contract staff by 15 per cent, which includes 25 per cent fewer executives.
The Oshawa Assembly plant has been in operation since November 1953. The loss of the facility will deliver a devastating blow to Oshawa and the Durham region, as 2,500 unionized workers and 300 salaried employees will be out of a job.
Prime Minister Justin Trudeau said in a tweet that he has already expressed his "disappointment in the closure" with Barra.
"GM workers have been part of the heart and soul of Oshawa for generations - and we’ll do everything we can to help the families affected by this news get back on their feet," tweeted Trudeau.
GM workers have been part of the heart and soul of Oshawa for generations - and we’ll do everything we can to help the families affected by this news get back on their feet. Yesterday, I spoke with @GM’s Mary Barra to express my deep disappointment in the closure.
— Justin Trudeau (@JustinTrudeau) November 26, 2018
The provincial government has deployed Employment Ontario's rapid re-employment training services team to the area. They are tasked with providing affected workers with targeted local training and jobs services to help them regain employment as quickly as possible and will coordinate with the federal government to support access to employment insurance and other programs.
"We are looking at how best to align our programs to ensure maximum support is available for affected employees and their families. In speaking with GM, we have stressed the importance of supporting their employees through this difficult transition," said Ontario Premier Doug Ford, who described this as a "difficult day."
"A lot of people are feeling shocked and saddened. I know some people are also feeling angry and betrayed," said Ford.
He is also calling on the federal government to immediately extend employment insurance (EI) eligibility to ensure workers in the auto sector can fully access the benefits.
"There is a precedent for this kind of action that has been deployed in Alberta's oil patch, and the people of Ontario are right to expect that the federal government will show a similar level of respect to the families that depend on Ontario's auto sector," said Ford. "We are also asking the federal government to work with their U.S. counterparts to remove all tariffs so that impacted auto parts suppliers can remain competitive after the Oshawa Assembly Plant closes its doors."
In protest of the plant closure, workers at the Oshawa facility walked off the job Monday morning, according to Unifor Canada.
Workers decided to walk off the job in protest after learning @GM has no product for them to make after 2019. @Uniforlocal222 members feel betrayed. #OshawaMadeGM #canlab pic.twitter.com/42dK8BdxsI
— Unifor Canada (@UniforTheUnion) November 26, 2018