General Motors workers packed an Oshawa union hall on Monday to hear what UNIFOR is going to do to save their jobs. Workers at the Oshawa plant walked off the job Monday after they were given the information about their plant's closure.
GM said it would shut operations at plants in Detroit; Oshawa, Ontario; Warren, Ohio; White Marsh, Maryland; and Warren, Michigan.
"It shows that every plant in the country has to prove its worth", BMO chief economist Doug Porter told Yahoo Finance Canada in an interview.
The Oshawa plant makes the Chevrolet Impala, a once-popular sedan that has seen its sales plummet in recent years as North American auto buyers increasingly favour pickup trucks and sport-utility vehicles.
These actions are expected to increase annual adjusted automotive free cash flow by 6 billion US dollars by the end of 2020.
GM also says it will reduce salaried and salaried contract staff by 15 per cent, which includes 25 per cent fewer executives.
"In contrast to times past, General Motors, under CEO Mary Barra, is trying to get ahead of a potential crisis by making cuts now", said Michelle Krebs, executive analyst at Autotrader.
The Oshawa's General Motors auto assembly plant in Oshawa, Ont., Monday Nov 26, 2018.
In its search for ways to help affected auto workers, the federal government declined to get into specifics - but insisted all options are under consideration.
In 2016, the Oshawa plant was spared closure after GM said it would invest $400-million to upgrade an assembly line.
Oshawa MPP Jennifer French told CTV News Channel that GM shuttering its operations would be "brutal" for the city, with effects of that decision rippling across southern Ontario.
GM employs approximately 2,800 people in Oshawa, down from a peak of 23,000 during the 1980s.
Ford later added: "We're disappointed in GM". "But some of the new employees went out and said 'I got a great job, and lots of overtime, I'm going to buy a house and new vehicle, ' and now they got all these loans and debts that they won't be able to pay".
The Canadian and Ontario governments joined the United States in supporting GM with billions of dollars in aid after the automaker filed for bankruptcy protection during the severe 2009 global economic downturn.
The reduction includes 8,100 white-collar workers, some of whom will take buyouts and others who will be laid off. Production began on November 7, 1953, and in the 1980s the plant employed roughly 23,000 people.
Stojkovic said she blamed both GM and the union, Unifor, for the dearth of information.
GM expects to record pre-tax charges of $3 billion to $3.8 billion related to the announced actions, including $2 billion of employee-related and other cash-based expenses and $1.8 billion in non-cash accelerated asset write-downs and pension charges.
"We started this transformation in 2015", Barra said.
"Oshawa Assembly is GM's most decorated plant with a highly skilled, committed workforce", stated Jerry Dias, Unifor's national president.
John Henry, the mayor of Oshawa, said early on Monday on Twitter that he hadn't talked to GM yet, and that a meeting was scheduled to begin at 09:30 a.m. Ontario time between the management and workers.
Total vehicle production at the Oshawa complex fell 60 percent through the first ten months of 2018 from the same period a year ago, according to Automotive News production data. "Obviously incentives by themselves don't keep a auto plant open", said the executive, speaking on condition of anonymity because of the sensitivity of the matter.