An analysis of General Motors’ production plans for the next six years shows the company will not maintain 20 per cent of its North American output in Canada despite what it has told the federal and Ontario governments.
The analysis by industry adviser AutomotiveCompass indicates GM Canada will not provide more than 14.5 per cent of the company’s North American volume between now and 2015, with the proportion falling as low as 12.2 per cent next year.
By comparison, GM Canada produced 22.1 per cent of the company’s North American volume in 2007.
In February, GM Canada promised the federal and Ontario governments it would maintain its current share of production in order to receive a long-term bailout loan of $6 billion —about 20 per cent of what it had requested from the U.S. government.
AutomotiveCompass president Bill Pochiluk said if the Canadian governments agree to give GM the $6 billion it has requested, they may be overpaying by about $1.5 billion, given its production plans.
Pochiluk said the closure of GM’s truck plant in Oshawa, which produced its last vehicle Thursday, putting 2,600 people out of work, is a harbinger of things to come.
“Truck production at Oshawa was more than just truck production, it’s the most profitable platform General Motors has, and when they take away a big chunk of the most profitable platform they have and move it someplace else, I think that was a very bad sign right there,” he said.
Premier Dalton McGuinty said Thursday he’ll fight to keep 20 per cent of GM’s production in the province, adding production levels are still under negotiation as part of the government aid package to the struggling automaker.
