OSHAWA, ON, June 1 /CNW/ - General Motors of Canada Limited announced
today that its comprehensive restructuring plan has been approved by the
Canadian and Ontario Governments. The agreements reached with key stakeholders
will enable the company to complete its restructuring efforts without the need
for court-supervision. The filing by General Motors in the United States is
not expected to affect GM Canada's operations.
From this restructuring will emerge a new GM Canada which will be
cost-competitive and innovative and will continue to put customers first. It
will remain one of Canada's leading auto marketers and manufacturers. It will
focus on Chevrolet, Buick, GMC and Cadillac, continue to invest in green,
energy-saving technologies and will be supported by a stronger balance sheet
due to a significantly lower debt burden and operating cost structure.
"GM Canada's restructuring has been challenging and has required
sacrifices by all of our stakeholders including our employees, retirees, the
CAW, our dealers and others. We are confident that these sacrifices will lead
to positive results. We appreciate the support of the Governments of Canada
and Ontario that will enable us to complete our restructuring and allow for a
more competitive, stronger new GM Canada," said Arturo Elias, President, GM
Canada. "Our customers can confidently continue to purchase new vehicles and
obtain service and take full advantage of GM's leading warranty coverage
throughout this process. The new GM Canada will be even more focused on our
The comprehensive restructuring plan approved by the Governments of
Ontario, Canada and the U.S., recognizes the high level of GM Canada's
integration in GM's North American operations. The integrated North American
Plan combines assistance from all three governments to ensure GM Canada will
continue as one of Canada's leading vehicle manufacturers with the associated
benefits of capital investment and direct employment, and indirect employment
through the supply chain and dealer network.
Consistent with the principle of proportional support for proportional
production, the Governments of Canada and Ontario will invest $C10.6 billion
in General Motors. As a result of this investment in both GM Canada and its
parent company, the Governments of Canada and Ontario will receive a
significant equity position in the new GM and secure the following benefits
- The launch of 5 new vehicles, including new hybrid vehicle production,
at GM Canada assembly plants in Oshawa and Ingersoll, maintaining GM
Canada's standing as one of Canada's largest vehicle manufacturers
with 16% share of GM's North American vehicle assembly.
- The introduction of flexible transmission production with the launch
of manufacturing of the fuel-efficient 6 speed front-wheel-drive
transmission at GM Canada's St. Catharines facility.
- Ongoing significant production of V6 and V8 engines will be maintained
at St. Catharines Powertrain.
- GMCL plans to make substantial capital investments over the next seven
years in Canadian facilities and contemplates no further GM Canada
plant closures at this time, reflecting restructuring actions already
- With the recently concluded agreement with the CAW, GM Canada's labour
costs will be competitive with Toyota Canada.
- GM plans to invest almost $C1 billion over the next seven years in
green research, development and innovation focusing on energy
diversification, fuel economy improvements and vehicle
electrification, through its Oshawa-based Engineering Centre. Canadian
suppliers and universities will be critical partners in this research
- Secures pensions for GM Canada retirees by improving funding levels
over time in the salaried and hourly pension plans and establishes a
"Health Care Trust" for hourly retiree health care benefits.
- The customers' needs will be better served through GM Canada's
consolidated dealer network with the broadest geographic coverage
across Canada of any automaker.
While our parent, General Motors Corporation, has announced it will
complete its restructuring through the use of a court-supervised process in
the U.S., GM Canada will complete its restructuring without the use of a
court-supervised process. We do not expect GM Canada's operations to be
impacted by the U.S. filing. GM U.S. and GM Canada expect that their customer
service, manufacturing and supply chain will continue with minimal disruption:
GM Customers - The Company's warranties and other service commitments,
such as OnStar(R), XM Radio(TM) and customer financing options remain in
GM Employees - Employees will continue to report to work as scheduled.
Wages and benefits will continue without interruption.
GM Manufacturing - GM Canada will continue to produce high quality GM
vehicles and powertrains as previously announced.
GM Suppliers - GM Canada's suppliers will continue to be paid for the
delivery of products and services. We expect supply from our key
suppliers to continue without interruption. Canadian supplier activities
will continue to be coordinated through GM's Global Purchasing and Supply
GM Dealers - GM Canada will have the strongest and broadest dealer
network across Canada and dealers will continue to service our highly
valued customers and have access to financing options, parts and warranty
coverage as GM Canada carries out its restructuring plans.
GM Canada is headquartered in Oshawa, Ontario and employs approximately
9,000 people nationwide. The company manufactures vehicles and vehicle
powertrains, and markets the full range of GM vehicles and related services
through approximately 700 dealerships and retailers across Canada.
For further information:
For further information: Stew Low, Office: (905) 644-6786, Cell: (416)
254-4224; Adria MacKenzie, Office: (905) 644-1824, Cell: (905) 442-6555