NEWS FROM Globeandmail.com
Canada to build Camaro
15:30 EST Friday, Aug 18, 2006
The Camaro muscle car will roar out of Canada again, General Motors Corp. is set to announce on Monday.
The world's largest auto maker has chosen an assembly plant in Oshawa, Ont., as the site for the rebirth of one of the classic cars of the 1960s and 1970s, sources familiar with the announcement said Friday. The car will go on sale in 2009.
The move is one of two major boosts for the auto maker's Oshawa operations. The other is that a plan to eliminate a shift of production and about 1,000 jobs at one of the company's car plants in that city is being reversed because of strong sales of the Chevrolet Impala mid-sized car, the sources said.
Both pieces of news will bring a major sigh of relief for more than 5,000 members of the Canadian Auto Workers union, who have been worried about their jobs since GM announced in November that it is cutting more than 30,000 jobs in North America and closing several assembly plants in a bid to bring production capacity closer to actual sales.
As a result, sources said, there will likely be no permanent layoffs at the Oshawa plants during the remaining two years of the CAW contract, with any jobs lost likely to be from attrition and productivity improvements.
GM will announce on Monday that it will redevelop its operations in Oshawa to create a flexible manufacturing facility capable of cranking out more than 500,000 vehicles off a rear-wheel-drive platform or basic chassis, industry sources said.
The Camaro will be based on GM's new rear-wheel-drive Zeta platform, which sources said will also include the next version of the Chevrolet Impala, the Cadillac DTS and the Buick Lucerne, sources in Detroit and elsewhere said yesterday.
GM stopped assembling the Camaro and its Pontiac twin, the Firebird, in Ste. Therese, Que., in 2002 amid slumping sales, caused in part by soaring insurance rates and what at the time were thought to be high gas prices.
Gas prices are higher now, but GM is responding to a huge positive reaction it received when it introduced a concept version of the Camaro at an auto show in Detroit in January.
The company expects to be able to sell 100,000 of the cars once full production volume is reached, industry sources said.
The issue of high gas prices will be addressed in part by a system that improves fuel economy by reducing the number of cylinders used when the car is cruising.
Redeveloping Oshawa to turn it into a flexible manufacturing operation capable of producing several models was originally part of the company's $2.5-billion Beacon Project, which included $435-million in financial assistance from the Ontario and federal governments.
It was put on hold after GM announced its restructuring plan in November, which at the time included 3,900 job cuts in Canada.
Ontario Premier Dalton McGuinty said in November that the government would push hard to make sure Oshawa won the mandate to produce a new vehicle.
Sources familiar with Monday's announcement said Mr. McGuinty spoke the next day with then General Motors of Canada Ltd. president Michael Grimaldi. Then the premier and Economic Development Minister Joe Cordiano met with GM officials a week later to push the province's case.