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GM to Kill Nine Plants while DaimlerChrysler Announces Big Spending in Canada

GM Bites Bullet and Opts to Close 9 Plants and Cut 30,000 Jobs before 2009

As part of a cost cutting plan designed to turn General Motors around financially, the impact on some 30,000 individuals and their families will be devastating when the automaker shuts down nine plants over the next four years and reduces the workforce dramatically at others.

Todays announcement from DaimlerChrysler Canada, on the other hand, where it promises to invest a total of $768 million (649 million USD) in its Canadian facilities, almost appears opportunistic this close to that countrys federal election campaign, but news that the automaker, riding high in profits due to an

The Doraville, Georgia minivan plant, which builds the Chevy Uplander, Buick Terraza, Pontiac Montana SV6 and Saturn Relay, will be closed for good in 2008. (Photo: Trevor Hofmann, American Auto Press)

exciting product lineup that has its Brampton, Ontario plant working around the clock to keep up with demand, may be music to the ears of Canadian GM workers expecting to be laid off from the Oshawa and St. Catherines operations, which include three plants affected by the bad news.

The Oshawa, Ontario plant that builds the Buick LaCrosee (Allure in Canada) will be closing in 2008, giving a skilled workforce to other expanding automakers such as DaimlerChrysler. (Photo: Trevor Hofmann, American Auto Press)

Currently DaimlerChrysler Canada directly employs approximately 12,000 workers, not including the thousands of employees working within its 475 strong Chrysler, Jeep and Dodge dealer network. And it only makes sense that along with the new investment it will be on the lookout for skilled workers for its new Windsor Assembly Plant

DaimlerChrysler Canada, which promises to invest a total of $768 million(649 million USD)? in its Canadian facilities, one of which builds the the 300C Touring wagon sold only in Europe, will now benefit from a larger pool of skilled workers. (Photo: DaimlerChrysler)

paint facility, scheduled to be operational by 2007, and most likely needing trained employees for upgrades to its Windsor and Brampton Assembly Plants, which will switching to enhanced flexible manufacturing processes in order to respond to fluctuating market demand by building multiple vehicle models and model variants on the same assembly line. DaimlerChrysler is also investing more into its University

DaimlerChrysler, which builds the worlds best-selling minivan, made even more popular due to its innovative Stow n Go seating system, will have invested close to $3.9 billion (3.3 billion USD) in its Canadian operations when this $768 million (649 million USD) is spent. (Photo: DaimlerChrysler)

of Windsor/DaimlerChrysler Canada Automotive Research and Development Center.
The automaker cites key agreements made with both the Ontario and Federal Governments as a main reason behind its decision to up investment in Canada. DaimlerChrysler is the second largest vehicle producer in Canada, as well as of October, second in retail too.

"The support of the Ontario and Federal governments is instrumental in building the business case

While some are calling GMs decision to reduce its total North American workforce by some 30,000 hourly jobs over the next four years heartless, the move is a much needed dose of a bitter pill that for UAW and CAW workers, will be hard to swallow. (Photo: Rob Rothwell, American Auto Press)

for new investments in our Canadian operations," said Tom LaSorda, Chrysler Group President and CEO.  "With these new investments, DaimlerChryslers Canadian manufacturing and R&D operations will continue to play a critical role in the companys global drive to achieving industry-leading products and benchmark operations.  At the end of the day, this new investment is a combination of government involvement, a responsible new collective agreement with the Canadian Auto Workers union (ratified in September 2005), and ultimately, the market response to the products

Hourly laborers wont be the only workers facing cuts, mind you, with salaried white-collar employees cut from the payroll to reach 40 percent since 2000, precisely the kinds of buyers that would have otherwise purchase the new Buick Lucerne. (Photo: General Motors)

the Chrysler Group manufactures in Canada."

In total, DaimlerChrysler will have invested close to $3.9 billion CAD (3.3 billion USD) in its Canadian operations when this $768 million (649 million USD) is spent, thanks to $2.6 billion CAD (2.2 billion USD) invested since 2002 and over $500 million CAD ($422 million) in R&D operations since 2000.
  
"More than 80 years after Walter P. Chrysler began operations in Canada, the Chrysler Group is proud to be Canadas second leading seller and manufacturer of vehicles - the majority of which are produced for export markets.  The automotive industry has changed dramatically over the years, but DaimlerChryslers

Wagoner expects the cost cutting plan will help GM reduce spending by approximately ($7 billion, allowing the automaker to invest in new products. (Photo: General Motors)

automotive leadership role in Canada continues to grow," said Steven Landry, DaimlerChrysler Canada President and CEO.  "It is a credit to the Ontario and Federal Governments that Canada is able to compete in the global automotive industry."

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