GM will once again build pickup trucks in Oshawa if tentative deal with union is ratified

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GM Canada says it will bring back pickup truck assembly work to its plant in Oshawa, Ont., if a new labour deal with its largest union is ratified.

Unifor had set a midnight deadline on Wednesday to reach a new, three-year labour deal with GM and had a mandate to strike from its members if the deadline passed.

But the union said just before the deadline that its master bargaining committee had a breakthrough and wanted to keep talking. About four and a half hours after extending the deadline, a tentative deal was reached. A ratification vote is to take place on Sunday.

Unifor said the deal is being unanimously recommended for 1,700 members working at GM plants in the southern Ontario cities of St. Catharines, Oshawa and Woodstock.

In a statement, the Detroit automaker said the deal would see more work for all three of its plants in Canada, including the return of assembly work to its facility in Oshawa.

"Subject to ratification of our 2020 agreement with Unifor, General Motors plans to bring pickup production back to the Oshawa assembly plant while making additional investments at the St. Catharines propulsion plant and Woodstock parts distribution centre," GM Canada president Scott Bell told CBC News in a statement.

The company says the deal would bring between $1 billion and $1.3 billion of new investment to Oshawa with the expected hiring of 1,400 to 1,700 hourly workers. That would bring the plant's workforce back up to about 2,000 people.

Tijana Martin/The Canadian Press
Tijana Martin/The Canadian Press

That's almost as many as worked there when GM suddenly withdrew most assembly work from the plant about two years ago. The last car assembled in Oshawa rolled off the line in December 2019, and the facility has been a parts plant since then. It also produces N95 masks as part of a government contract announced earlier during the COVID-19 pandemic. About 300 people currently work at the plant.

The deal would also bring about $109 million worth of work to the St. Catharines engine and transmission plant and about $500,000 to the Woodstock facility, GM said in a statement.

The popularity of pickup trucks is key to the deal. GM CEO Mary Barra told analysts on a conference call discussing earnings on Thursday that demand for profitable models such as the Chevrolet Silverado and GMC Sierra is so strong that the plants that make them are operating "around the clock."

"The fact is we simply can't build enough," she said, "and because we expect demand to remain strong we must increase capacity."

The first pickups are expected to roll off the line in Oshawa in 2022. The company didn't specify what pickup trucks would be made in Oshawa, but Flavio Volpe, president of the Automotive Parts Manufacturers' Association, said he suspects GM will move some Silverado and Sierra work there.

John Gress/Reuters
John Gress/Reuters

When GM cancelled assembly in Oshawa, it didn't shut the plant down entirely, and Volpe said it was telling that the company kept about 300 workers on hand to keep making parts there.

"That was a signal that the plant would be in play if there was a product for it," he said.

Previously, the Oshawa plant had been putting the finishing touches on Silverados and Sierras that came up mostly completed from a plant in Fort Wayne, Ind. Now they'll be completely assembled in Oshawa, breathing new life into Canada's oldest continuously operating car plant.

The facility has been owned and operated by GM since 1953 but has been making cars since 1908. At one point, it was the company's biggest factory in the world, cranking out 750,000 vehicles a year.

"This is a generational commitment to Oshawa car-making," Volpe said.

The union says the deal could mean up to 2,000 new jobs when assembly starts in January 2022, with a second shift added in March. There are plans to add a second vehicle in May, and if a third shift is potentially added in July 2022, that could be another 500 jobs, Unifor said.

3rd deal with Big 3

The stunning news came after Unifor warned that GM had not offered concrete commitments on future product plans and was falling short of earlier agreements struck by Ford Motor Company and Fiat Chrysler Automobiles.

A key plank of the deal with Chrysler will see the company get government help to redesign its Windsor, Ont., plant to produce at least one electric vehicle.

It's unclear if any government cash will be part of the expansion at GM.