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Detroit Three “won’t waver” from $1.5B investment in Canada

Despite protectionist rhetoric, they’re encouraged by Trump’s comment about just tweaking NAFTA.


February 17, 2017
The Canadian Press
by Aleksandra Sagan

Ford Motor Co. of Canada’s Oakville Assembly plant.
Photo: Ford

TORONTO — The three largest automakers in North America say they won’t waver in their collective bargaining commitments to invest $1.5 billion in total in their Canadian operations despite the protectionist rhetoric of US President Donald Trump.

“We’re very committed to our manufacturing footprint here in Canada,” Mark Buzzell said in an interview during a media day at the Canadian International AutoShow.

Ford promised last fall it would inject $700 million into its Canadian operations as part of a labour deal reached with Unifor, which represents about 6,700 workers at the company’s facilities in Ontario.

That money will go towards Ford’s engine plants in Windsor, Ont., and its assembly plant in Oakville, Ont., said Buzzell, who took over as Ford Canada’s president and CEO last month.

“We’ve got a really good globally competitive situation for us here in Oakville,” Buzzell said, adding that the vehicles it produces there – the Ford Edge, Ford Flex, Lincoln MKX and Lincoln MKT – are exported to more than 100 countries.

General Motors has promised to spend $554 million across its Ontario operations in Oshawa, St. Catharines and Woodstock.

“We’re busily implementing those projects across the three sites,” said Stephen Carlisle, the president and managing director of GM Canada.

A Fiat Chrysler spokesperson said in an e-mail that the company committed to investing $325 million in Brampton, Ont., and $6.4 million in Toronto operations and “will continue to work within the structure of that agreement.”

Since Trump became president promoting protectionist policies, questions have arisen over whether the automakers remain committed to those investments.

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Last month, prior to Trump’s inauguration, Ford scrapped plans to build a US$1.6 billion auto plant in Mexico and shifted investment to the US. The company said market forces led to the decision.

Trump has also kick-started efforts to renegotiate the North American Free Trade Agreement, spoke of the need to implement border tariffs and withdrawn US participation in the Trans-Pacific Partnership.

Buzzell said it’s difficult to speculate on how such policies could affect the auto sector, but added that Ford is a big proponent of free trade and believes NAFTA has served it well. He said Ford wants to see trade agreements that are fair, provide an even playing field and prevent currency manipulation.

Carlisle said it’s possible NAFTA could use an update.

“I look at it as it’s a 22-year-old agreement that, surely, it can be improved,” he said, adding life has changed since NAFTA came into play in 1994.

Trade agreements currently in place could be improved upon by facilitating better cross-border activity and flow of skilled workers, he said.

There is reason for Canada’s automotive industry to feel encouraged despite Trump’s tough talk, said Carlisle, pointing to the meeting between the president and Prime Minister Justin Trudeau.

During the visit, Trump suggested any changes to NAFTA may be just minor “tweaking.”

“There’s reason to be optimistic,” Carlisle said. “At the same time, nothing to be taken for granted.”

News from © Canadian Press Enterprises Inc. 2016

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