Are you to blame for the Oshawa GM plant closure? Partly
Was the shutdown of GM’s Oshawa assembly plant a surprise to you? It wasn’t to Dennis DesRosiers. He’s good because he looks at the numbers, spots trends, and doesn’t let narrative or anecdote — political or otherwise — push him off his mark. He doesn’t care if you don’t like what he has to say; he’s telling you what the numbers indicate, and to DesRosiers, the numbers have heralded this plant closing for years. When a plant, at peak, is pumping out nearly a million cars a year, and that number starts plunging, there are always reasons. In the current automotive climate, which is now a global entity regardless of where you think your car came from, none of the old calculus applies. During the last strike at the Oshawa plant, in September, 2007, DesRosiers predicted the plant would be shuttered for good in the near future, and had spears lobbed at his head. The first year DesRosiers Consultants has numbers for the Oshawa assembly plant is 1977; that year saw nearly 700,000 cars leave the floor. After 2003, sales began to slide for GM across North America, as sales of imports soared. Oshawa was not immune to the slide, its production going from nearly a million vehicles in 2003 to slightly more than 148,000 vehicles last year. The workforce has shrunk accordingly. Oshawa was producing cars nobody wants to buy anymore. You can’t sell what consumers don’t want. SUVs and CUVs make up nearly 75 per cent of the market in North America. Ford and FCA gave up on most of their cars ahead of GM, as everybody tries to read the tea leaves of a buying public that has become accustomed to changing its mind every few years. This wasn’t supposed to happen. It seems like only yesterday there was a race on for teeny tiny cars. We gorged on tarted-up pickup trucks when Ford introduced the first Explorer in 1991, and there were more Hummers on the 401 than in Iraq. But heavy, fuel-guzzling trucks masquerading as urban daily drivers were supposed to be a fad, like binge-drinking in college. We were supposed to grow up and want more appropriately sized fare that spat out fewer emissions. So out came the littles: The Honda Fit, the Chevy Sonic, the Hyundai Accent, the Toyota Yaris. They were the darlings, for a while. A tank of gas went forever, and there was enough room for most daily needs. What happened? People went shopping with the intention of buying just what they needed, and came out having succumbed — to borrow a phrase from the boating world — to one-foot-itis. With interest rates so low for so long (those years of 18 per cent mortgages were long forgotten) and gas never quite reaching the Chicken Little highs we’d been fearing, we passed over the sensible purchase and migrated to land yachts. SUVs don’t actually have a lot of utility, if you ask me. With fat profit margins rewarding those who could lure the most customers in, more people wanted leather interiors than towing capacity and seating for seven, as if five-children families are the norm. The pickups are even more ridiculous. The other day, I was testing a gorgeous beast that rang in near $100,000, but I couldn’t fit a love seat in the bed. Compact CUVs were a lovely midway solution; Honda and Toyota continued not to muck with what wasn’t broken, even as the segment they’d dominated for decades with the CR-V and RAV4 became as crowded as a telephone wire supporting a murder of crows. That’s not to say if there’s a big SUV in your driveway this is totally your fault; only that as buying habits change, production habits must, too. You can dislike the fallout — and Oshawa’s GM history is a century old — but you can’t think a company can fuel itself with nostalgia.