Autoworkers at GM’s Oshawa plant ask feds for more than $1B to build electric vehicles

Workers at the General Motors Oshawa assembly plant are calling on the federal government to fund a project that would transform the site into a publicly owned electric vehicle factory.

The group, called Green Jobs Oshawa, revealed details of the plan at a public forum on Thursday evening.

“What could make more sense than the government stepping in and saying, ‘We will ensure that we will keep jobs here, that we develop the technology here and that we build the vehicles of the future here?'” said Tony Leah, a chairperson with Unifor Local 222.

The Oshawa factory is one of five North American assembly plants owned by GM that are set to close at the end of the year. GM plans to turn the site into smaller-scale stamping and testing facility after 2019.

GM employs around 2,500 workers at the facility, which has been a pillar of Canada’s auto industry since it opened in 1907.

“It would mean the world to me if we could get this to come to fruition,” said Rebecca Keetch, who works as an assembler.

The proposal to preserve auto manufacturing in Oshawa calls for a federal investment of $1.4 billion to $1.9 billion to transform the existing facility into a plant that would produce electric vehicles for government agencies such as Canada Post.

The study says the transformation would preserve around 13,000 jobs in Oshawa, leading to sales of 150,000 vehicles over the plant’s first four years at a value of approximately $5.8 billion. 

Those vehicles could also lead to a reduction of 400,000 metric tons of CO2 emissions over four years, according to the study, which was authored by consultant Russ Christianson.

Auto workers facing job losses at the end of the year attended a meeting about the electric vehicle proposal on Thursday evening. (Angelina King/CBC)

Green Jobs Oshawa says achieving those lofty goals will require federal participation.

The group points to Ottawa’s bailout of Canada’s auto industry during the global financial crisis of 2008, when the federal government handed $13.7 billion to GM and Chrysler as the companies teetered on the verge of bankruptcy.

“Any nation in the world that has a strong auto industry has a strong auto industry because of government participation,” added Unifor national president Jerry Dias.

Bold idea, or ‘job creation scheme?’

Bernie Wolf, a professor emeritus at York University’s Schulich School of Business, described the plan as a “job creation scheme” that would be difficult to justify.

“If this were really feasible, if this were really possible, wouldn’t GM be doing this itself?” asked Wolf, who studies the auto industry and vehicle manufacturing.

He said a government-owned plant would struggle to develop the technology needed to produce high-quality electric vehicles, meaning the plant would likely have to import technology from private companies.

Government agencies such as Canada Post could also purchase electric vehicles at lower prices from more established manufacturers, he argued.

Canada Post purchased 500 hybrid delivery vehicles in 2018, but its not clear if the company has the capacity to add more electric vehicles to its fleet. (Darren Calabrese/The Canadian Press)

“The more I think about it, the less sense it makes,” he added. Spending money educating workers would be a wiser long term investment, he argued.

While Wolf was skeptical of the plan, electric vehicle researcher Olivier Trescases called the idea an “interesting and timely opportunity.”

Trescases, who runs the University of Toronto’s Electric Vehicle Research Centre, said the project could succeed if it maintains a strict focus on producing vehicles for government use.

“I think that aiming for government owned EV fleets and electrified public transportation is strategically very important and more logical than trying to produce passenger cars though a crown corporation,” he wrote in an email.

More hurdles to clear

While there is no indication that the next federal government would commit to such an expensive and ambitious project, there is some precedent for that type of acquisition.

In 1974, Ottawa purchased the aircraft manufacturer de Havilland, which produced the Dash series of turboprop regional airliners. However, the government sold the company to Boeing in 1986.

The German courier Deutsche Post, which was privatized in 1995, also purchased the electric vehicle company StreetScooter in 2014. It now has 10,000 electric vehicles in its fleet.

Tony Leah, a chairperson with Unifor Local 222, says crown corporations have a proven track record delivering a wide range of products and services. (Angelina King/CBC)

However, it is unclear if the publicly owned Canada Post has the capacity or desire to purchase several thousand electric vehicles.

In 2018, Canada Post purchased 500 hybrid delivery vehicles, which are going into service this year. In a statement to CBC, the crown corporation said it “continues to consider alternative propulsion technologies that can be rolled out at scale, including electric vehicles.”

Green Jobs Oshawa has acknowledged some of those logistical and financial challenges, but the group says the project should also be considered for its potential benefits to the environment and local community.

“We have to look at a broader picture than just a bottom line,” Leah said.

Read more at CBC.ca