TORONTO, Dec. 11, 2014 /CNW/ - Today GM announced a major investment in Mexico.
"Unifor is disappointed by this announcement but our determination to work with GM to ensure it has a strong future in Canada is unwavering," said Jerry Dias, Unifor National President.
According to GM, Canada ranks #6 in its global manufacturing and is one of its strongest markets.
"We are confident that GM recognizes the competitiveness of its facilities in Canada and are optimistic that GM remains committed to Canada for the long-term," said Dias.
Still, the union is concerned, noting that GM's decision adds to the avalanche of new investment announcements received by Mexico in the last year. Several other companies (including Audi, BMW, Kia, Daimler, Nissan, Honda, and Mazda) have recently announced new greenfield auto assembly operations in Mexico.
Soon Mexico will be producing more than one of every five vehicles in North America. Under NAFTA, Mexico has expanded its vehicle assembly dramatically – but all at the expense of US and Canadian investment and production.
Canada already experiences a significant automotive trade deficit with Mexico (equal to $9 billion in 2013, and projected to be more than $10 billion this year). The deficit is a result of the fact that the industry in Mexico is oriented to exports, but Mexicans are paid so low they can't buy Canadian-made products. Canada imports close to $15 in auto products from Mexico, for every dollar Canada exports to Mexico.
"The bottom line is that Canada has many advantages to offer GM for high-quality, competitive, profitable production. The productivity and quality awards won at Canada's plants are unmatched anywhere in GM's global operations," said Dias.
The union also pointed out the decline in the Canadian dollar means Canadian costs are now fully competitive with any industrialized country. The company is highly profitable in Canada, on both the sales and the manufacturing arms of their business.
"GM was saved in 2009 in large part thanks to sacrifices by its Canadian workers, Canadian retirees, Canadian taxpayers, and other Canadian stakeholders (including suppliers and dealers)," said Dias. "The federal and Ontario governments contributed over $10 billion to GM's rescue in 2009. We are very disappointed that GM would look at such a huge investment in Mexico today, when the future of its Canadian manufacturing operations is unclear."
The federal and Ontario governments still own seven per cent of GM – making them together the largest common shareholder in the company. To date, the governments have not used that leverage to ensure future investments in Canada. And have even indicated they may sell their shares (even before winning back the full value of the funds invested in GM). Unifor is urging the governments to maintain their GM shares and use them more actively to win future investments in Canada.
"Today's announcement is a call to action for the federal and provincial governments to play a more active role in ensuring GM's long-run presence in Canada," said Dias. "Canadian workers and suppliers and communities will do everything we can to make our factories the most high-quality and productive in the world, and highly profitable. But we cannot match Mexican wages – nor should we even try to. We need a national auto strategy and sensible trade agreements – not a one-way street like NAFTA has become," said Dias.
Unifor reiterated its commitment to a productive, constructive dialogue with GM about making the most of its Canadian assets.
Unifor is Canada's largest union in the private sector, representing more than 305,000 workers. It was formed Labour Day weekend 2013 when the Canadian Auto Workers and the Communications, Energy and Paperworkers union merged.
For further information: please contact Unifor Communications Director Sarah Blackstock at Sarah.Blackstock@Unifor.org or (cell) 416-949-1072