Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Tuesday November 27, 2018
USMCA not to blame for GM plant closures, but it’s killing all hope of exporting from North America
U.S. President Donald Trump’s trade policies were likely just one factor among many that contributed to General Motors’ decision to shutter multiple plants in the U.S. and one in Oshawa in Ontario, analysts say.
But the closures will undoubtedly sharpen scrutiny of the White House’s “America First” trade agenda — a strategy aimed at preserving jobs in traditional industries through controversial measures including steel and aluminum tariffs that have ultimately squeezed automakers, analysts say.
“Only a few months ago GM said that the Trump tariffs were costing a billion dollars but they were going to wait until after the mid-term elections to take action,” said Dennis DesRosiers, president of DesRosiersAutomotive Consultants. “It is now past the elections and they are taking action. Partial blame for this goes to Trump and his isolationist policies. It is much bigger than U.S. politics, but it certainly is part of the issue.”
GM will shutter its factory in Oshawa as part of a global restructuring as the company shifts to manufacturing electric and autonomous vehicles. The move will see 2,973 jobs cut by the end of 2019 at the Oshawa plant, which has been in operation since 1953. The Detroit firm will also slash a total of 6,705 jobs at plants located in Warren, Ohio; White Marsh, Md; and two facilities in Michigan.
Other Canadian manufacturing facilities in St. Catharines and Ingersoll, Ont. will not be affected.
“Trade headwinds” and, in particular, Trump’s tariffs of 25 per cent on imported steel and 10 per cent on aluminum, have also been identified as a key business challenge by more than one automaker as they attempt to make difficult transitions in their product lines and operations. In September, executives at Ford Motor Co. blamed the tariffs for taking US$1 billion out of company profits. (Source: Financial Post)