Ford Motor Co. and Governments Unite Providing a Boost to Manufacturing

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Positive affirmation the future of the Canadian manufacturing sector makes headlines on a much more infrequent basis nowadays than it did during the s and 1980s when automotive plants in Canada were running at a fever pitch. It was the golden era for the industry.

While those golden days have downgraded to silver or bronze, there is definitely room for optimism that this once massive industry can and will be able to sustain a valuable position in the world global market thanks to a commitment from the manufacturers and our governments, who plainly recognize that such industry is vital to the health of our national and regional economies.

The auto industry is a vital cog to the economy of Ontario, which hosts all vehicle assembly plants in Canada and also the vast majority of the 150,000 jobs in assembly and parts manufacturing that compliment the main auto plants themselves. Auto manufacturing and auto parts components represent about 2.5 per cent of Ontario’s gross domestic product. That figure increases to almost 10 per cent if you factor in other reciprocating industries such as steel production, transportation and warehousing facilities.

On its 60th anniversary of being in Oakville, a $700 million investment announcement was recently made by Ford Motor Co., officially coming via Executive Vice President and President of the Americas for Ford Motor Company Joe Hinrichs at a large ceremony held in Oakville. The injection of capital helps guarantee a degree of stability in the manufacturing sector for a number of years to come. It’s an increase of $200 million in spending in Canada each year and takes the total commitment to $4 billion each year.

Adding to that total is a combined $135 million coming from the federal and Ontario governments. Ford first came north of the border in 1904 with the opening of the Essex plant near Windsor.

“This investment is helping us find much needed capacity for global products and securing jobs and it is positioning Oakville as one of the most competitive and important facilities in the Ford system,” Hinrichs said in addressing a large media contingent as well as hundreds of workers at the Ford Assembly Plant.

“Global fuel-efficient products, built in a state-of-the-art facility, by a great workforce are a win for everyone today,” Hinrichs continued. He also confirmed the plant would bring new “global” models to the plant.

Ford Canada chief executive Dianne Craig credits a “competitive labour agreement” with the autoworker union now called Unifor and the Ontario and federal governments for offering additional funding to make the project a reality. Ford Canada employs 6,000 people.

“Ford’s investment demonstrates Canada can be competitive in the global market through strategic partnerships,” said Craig. “Working closely with government and labour, we have secured a bright future for our employees at Oakville Assembly.”

“For three years – and going on four – more Canadians have chosen a new Ford vehicle than any other automotive brand, Craig proudly stated.

In this era of a global economy, it’s essential that manufacturing facilities be set up to serve countries well beyond their own borders.

“Canada can compete and win in today’s global economy,” Craig said. “Quite honestly, I wouldn’t be standing here without the full support of our union partners and both the federal and provincial governments. We know from experience that investment in manufacturing pays off. “Looking ahead we’ll continue to focus on products and technologies that customers want through innovation.”

The inclusion of both the provincial and federal governments also sends a signal to Ford and working Canadians that there is a strong commitment to keeping manufacturing a strong and vibrant sector in our economy.

“This isn’t a cost to the government, this is an investment in the future,” Premier Kathleen Wynne told the audience. “Advanced manufacturing is one of our strengths…it’s what we need to keep our economy growing and cooking. I believe we can as a strong Ontario create good jobs for families and draw business here…we are competitive and we have the talent and resources.”

While there were no new jobs announced for the 60-year-old plant, getting the global platform to make more Ford models for the world market holds out the prospect for more employment.

The plant currently operates two assembly line shifts on weekdays, with the body and paint shops working three shifts. The Oakville facility produces the Ford Edge, Ford Flex, Lincoln MKX and Lincoln MKT.

Hinrichs says a move towards enhanced global manufacturing at the Oakville plant will enable Ford to shift production based on consumer demand very quickly.
“If consumers suddenly shift their buying habits, we can seamlessly change our production mix without having to idle a plant,” he said. The company uses nine global platforms around the world to build about 85 per cent of its vehicles.

“Flexible manufacturing enables us to get vehicles to consumers faster than ever before. This is a great value proposition for everyone.”

Ford has invested more than $2 billion to its facilities in Ontario over the past nine years, including a previous $1 billion allotment in Oakville. Another $590 million has been invested in Windsor Ont.’s engine plant.

It’s estimated that each direct manufacturing job equates to an additional 10 supporting jobs within the auto parts industry. What may be astounding to some people is that Ontario now actually produces more vehicles on an annual basis than Michigan, the birthplace of the North American automobile.

The Oakville funding will enable Ford to assemble the Ford Edge models and Lincoln MKX crossovers on a global platform that also serves as the base for the mid-sized Ford Fusion and Lincoln MKZ sedans and is expected to be extended to other new vehicles. Production of the current versions of the Edge and MKX will end in late 2014 with assembly on the new platform scheduled to begin early the following year. Assembly of the current versions of the larger Ford Flex and Lincoln MKT crossovers will continue on their current platform through 2018 and production of Edge and MKX will rise as the two larger vehicles are phased out.

“I was here on this stage in January with the prime minister announcing the funding by the federal and provincial governments which was so important in allowing us to be here today,” Hinrichs continued. “A renewed five-year Automotive Innovation Fund from the federal government puts $250 million a year towards the program.”

Hinrichs also took the opportunity to indicate it was a team effort from a number of different people and enterprises that allowed them to reach this historic date in Canadian manufacturing history.

“It’s not just a great day for our employees but our supplier partners, our dealers and our corporate and union partners as well without whom this couldn’t be possible,” he said.

The investment allows Ford to generate much needed capacity for global products and securing such well-paying jobs. It also positions Oakville as one of the most competitive and important manufacturing facilities in the Ford global manufacturing system. When the retooling is complete, Ford will bring several new global models to the Oakville plant for the first time in order to meet the demand not only in North America but around the world.

“I look back on the last decade and Ford has invested more than $2 billion in Canada,” Hinrichs reaffirms. “This is Ford at its best.”

Federal Minister of Industry James Moore also took the time to acknowledge the various players responsible for bringing this project together.

“Ford’s Project Northern Star is part of a 10-year, $1.1 billion project to transform this facility into one of the most sophisticated in the world,” he said.

The aim is to expand research and development and ensure work is done at the Oakville Assembly Plant.

“It will also ensure this plant has the ability to produce high-quality, fuel efficient and smart designed vehicles that the newly redesigned Ford Edge, Flex, Lincoln MKX and MKT and continue support these products around the world,” Moore continued. “We all know Ford’s story and how well it did relative to others (during the recession) and it’s built on the hard work of workers in this plant and a sales team built across this country and the leadership Ford has shown time and time again to steer the company in the right direction along with great quality products. Our government is pleased to commit $71.9 million to this project.”

Ontario Premier Kathleen Wynne echoed the sentiments of Moore, and confirmed the provincial government would be putting in similar dollar figures as its federal counterpart.
“It’s important that we celebrate partnerships that lead to this kind of success,” Wynne remarked. “The work that Ken Lewenza did before the work that I know Jerry (Dias) is going to do in combination with the company here in Canada and worldwide that’s what is going to allow us to continue to move forward.”

This is definitely the type of investment plays to Ontario’s strength. The province is recognized as a hub of innovation. Advanced manufacturing is one of its core strengths. Wynne says her province has the talent, drive and resources to move the economy forward.

It wasn’t that long ago when Jerry Dias was named the first president of Unifor, which is Canada’s largest labour union following the merge between the Canadian Autoworkers and the Communication, Energy and Paperworkers Union of Canada. It’s been a great first month for Dias at the helm.

“Ford’s announcement solidifies our future for well over a decade with thousands of great paying jobs to go along with it,” Dias emphatically stated. “Every job in this plant supports another six to seven jobs in the Canadian market.”

The commitment to Oakville also means billions of dollars in exports and tax revenues.

“The government of Canada, the government of Ontario – they’re making an incredible financial investment but they know they’ll get that investment back many, many times over as a result of the spin-off benefits of this plant,” Dias confidently stated. “And let’s recognize the workers, because not one vehicle would roll off the line today if it wasn’t for the sweat, the brains and the commitments of the members of Unifor Local 707. We won this investment; we earned this investment; we absolutely fought for this investment."

By Angus Gillespie

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