TORONTO (AP) — General Motors Corp. is committed to its car-assembly complex in Oshawa, east of Toronto, the president of the Canadian Auto Workers union said Thursday in response to a report that the plant's future is shaky.
Buzz Hargrove noted that GM is spending $2.5 billion in Oshawa — including $435 million from the Ontario and federal governments — under its Beacon project announced in 2005, and the automaker has confirmed production of a new rear-wheel-drive Camaro sports coupe will start there this year.
''We anticipated that would be followed by other rear-wheel-drive vehicles, but the money they spent on the plant makes it a flex plant, so you can build both front-drive and rear-wheel-drive in the facility,'' Hargrove said.
''We're going to be meeting with GM sometime late next month, but I'm confident that they not only want to build there, they're obligated to: Mr. McGuinty's government put $235 million into the Beacon, Paul Martin's government put $200 million in, and our local union bargained a new agreement,'' he said.
''So they're obligated to put something in there. The only question is what, and when they're going to announce it.''
The Globe and Mail reported that General Motors has scrapped plans to build new rear-wheel-drive sedans in Oshawa, which could reduce planned output at Canada's largest automotive manufacturing complex by 250,000 units per year.
The report comes as GM prepares for contract talks with the CAW this summer.
''If they haven't made a decision by then, will they use this in bargaining? Of course, they always use everything they have in their arsenal,'' Hargrove said.
However, he stressed: ''They've already run concessions out of our local committee ... and part of that was a commitment to a new product in the plant, and our people have that in writing.”
The issue arises when the auto industry as a whole is in flux as requirements escalate for more fuel-efficient and less polluting vehicles. Rear-wheel-drive cars, generally heavier than front-drive models, are under a cloud following passage of U.S. legislation requiring automakers' fleets to average 35 miles per gallon (6.7 litres per 100 kilometres) by 2020.
''That means that all the companies are reviewing their fleet now in terms of what combination of vehicles they can build and still meet that act,'' Hargrove observed.
Nevertheless, ''our position today is that they (GM) are already obligated and committed, to both the federal and provincial governments and to our union.''
Crude oil cost US$53 per barrel when the Beacon project was announced in March 2005, compared with about $88 now after touching $100 early this month.
