Windsor now ‘epicentre’ of Canadian auto industry
Employment in sector is up 30% since 2012, research reveals
FCA Canada’s Windsor Assembly Plant has grown into Canada’s single-biggest manufacturing facility by employment, and Windsor-Essex has morphed into the country’s automotive “epicentre,” according to a new report.
With a workforce of 6,000 building Dodge Grand Caravans and Chrysler Pacificas, the Windsor plant last year catapulted ahead of Suncor and Syncrude in Fort McMurray, as well as ArcelorMittal Dofasco in Hamilton and the Ford Oakville and Toyota Cambridge auto assembly plants, according to the Automotive Policy Research Centre.
The study concludes that the Canadian auto industry enjoyed “steady growth and stability” in employment and vehicle production during the five-year period between 2012 and 2016.
But in Windsor and Essex County, employment in the automotive industry grew by a whopping 30 per cent between 2012 and 2016, according to APRC project manager Brendan Sweeney, who is also the author of the report.
In the most detailed and upto-date study of its kind, Sweeney also discovered there are a lot more workers employed in the Canadian automotive sector (140,404 in 2016) than what’s reported by Statistics Canada (125,395 in 2016).
It also points to an increasingly concentrated domestic auto industry, with most jobs in the sector located in southern Ontario, “and Windsor-Essex emerging as the sector’s epicentre,” according to the report.
“This illustrates the economic importance of the industry,” Sweeney said of the report’s numbers.
Employment has grown as the domestic industry continues shifting from car production to the manufacture of light-duty trucks and higher-value-added vehicles requiring more person-hours to assemble. Light-truck production as a total of all Canadian vehicle production increased from 58 per cent in 2012 to 67 per cent in 2016, according to the report.
While annual vehicle production averaged just below 2.4 million units in Canada over the past five years, employment in both the vehicle assembly and automotive parts manufacturing industries “increased in every year between 2012 and 2016,” the report states. In addition to the shift to bigger vehicles, the report points to increased demand for Canadianmade automotive parts in the U.S.
Windsor-Essex employment at FCA, Ford and upper-tier parts suppliers grew to more than 18,000 workers in 2016 from just under 14,000 in 2012, according to the APRC.
Sweeney said it’s important for the industry and policy-makers to have access to the most up-to-date and accurate numbers possible.
“The industry can now say, ‘Our impact is probably bigger than what the public thought … we contribute more,’” said Sweeney. By capturing data now and not up to years after the fact, he said policy-makers can make better and timelier decisions on an important sector of Ontario and Canada’s economies.
While the conclusions of the APRC report appear rosier than might have been expected given the North American trend over the past five years of increased automotive investment in Mexico and the United States, the author does issue a warning and points to the need for further action.
“There’s less room for growth in the existing footprint than there was five years ago,” said Sweeney. “If we’re going to grow, we need to build more plants,” he added.
General Motors’ vehicle production is expected to decline following the closure of the consolidated assembly plant in Oshawa and the end of the GMC Terrain assembly in Ingersoll this year, according to the APRC report.
During the five-year period studied, GM lost its decades-old status as Canada’s largest Original Equipment Manufacturer (OEM). Toyota now holds top spot, ahead of FCA Canada. Approximately 30 per cent of Canada’s automotive manufacturing workforce is now employed in vehicle assembly, with the balance employed in automotive parts manufacturing.
Five OEMs employed 37,127 people in their manufacturing operations in 2016, according to the report by APRC, which is headquartered at Hamilton’s McMaster University. Both Ford in Oakville and Toyota in Cambridge employ more than 5,000 people.
Sweeney said Statistics Canada under-reports automotive manufacturing employment by excluding some businesses that produce automotive parts and components but are not categorized as such. He said his research identified over 200 such automotive parts manufacturing establishments.
Almost all Canadian automotive production now takes place in Windsor-Essex and in, or near, the Highway 401 corridor between London and the Greater Toronto Area, according to the study, which is being formally released today.
Automotive production and employment in areas outside those two zones — “in regions peripheral to the supply chain” — trended in the opposite direction.
After hiring 1,200 workers last year following its Pacifica announcement, FCA Canada employs more people in Windsor today than at any time since 2003. That year, then-DaimlerChrysler had 6,824 workers at its Windsor and Pillette Road assembly plants.
Peak employment at WAP and Pillette was 8,350 in 1999, the year Canada as a whole also saw its peak production of vehicles, with just over three million units.
The current proportion of light truck production to cars is likely to continue to increase in the near future, with Toyota replacing Corollas with the RAV4 in Cambridge and GM beginning to assemble pickups in Oshawa, said Sweeney.