Headline juxtaposition du jour: Canadian auto sector edition

Two items on my google news page:

GM to lay off 700 more workers in Oshawa: General Motors of Canada Ltd. is laying off 700 more workers at its Oshawa, Ont., operations, the Canadian Auto Workers union said Friday.

The layoffs at the car plant will take place in February.

Further down:

Toyota opens second factory in southern Ontario: Toyota Canada held a ceremony in Woodstock, Ont., on Thursday to officially open a new $1.1 billion plant about a month after its assembly lines began running.

The plant, which employs about 1,200 people, is Toyota's second facility in Canada. The other one is in nearby Cambridge.

Draw a line between those two data points, and you get the tendance lourde ('heavy trend' – another useful expression that English doesn't seem to have) that the Detroit Three are fighting – probably in vain.

6 comments

  1. Traciatim's avatar
    Traciatim · · Reply

    It’s pretty straight forward. GM = Unionized, Toyota = Non-Unionized. GM = Failing, Toyota = Succeeding.

  2. CBBB's avatar

    It’s not straight forward at all. If you think the Unions are the reason GM is failing, you clearly don’t have a clue. What about GM management’s longterm investment in now-unsellable SUVs?
    You’re comparing two different companies with two different product strategies and line ups and two different management styles and you decide to pick a single factor and decide that THIS is the reason? Clueless.

  3. Traciatim's avatar
    Traciatim · · Reply

    Yeah, I’m sure that if the average wage of workers was dropped by over 30% to match foreign companies that and that let the price of the cars be cheaper by 10% that the domestics wouldn’t be in fantastic shape right about now. GM has tons of small cars, a great mid sized line up, and also makes SUVs. Ford’s fusion is a fantastic descent sized car that you can also get some power out of, which is nice. If it’s price dropped by 10% it would be fantastic and kill the compitition. As it stands now you can get a Nissan Altima 3.5, which is an arguably nicer car, for about 2500 more than the fusion. I would pay the difference and I’m a ford person (currently in a Taurus and like it, the fusion has the same engine which has a pretty reliable history). However, if the price of the fusion at about 28000 was instead 25200 . . . wow, they would be flying off the lot.
    Same thing with say a Malibu and a Camry. The Camry is slightly cheaper with the options I picked and I would probably be forced to buy one if I was picking between these two cars . . . The Camry I priced came in at around 30700 with 268HP, and the Malibu 31560 with 217HP (enough for the vehicle to perform nicely). However, if the labour cost could decrease the price of the Malibu by 10% and make it 28400, don’t you think far more people would pick it over the Camry? The labour cost is a huge input to the cost of a vehicle, and the unions have faught long and hard to make themselves obsolete.

  4. Mark Dowling's avatar

    What could Toyota and Honda do with 2.5 billion apiece?

  5. CBBB's avatar

    Doesn’t matter much about the current lineup Traciatim. GM, Ford, Chrysler have spent YEARS building a reputation (real or imagined, but either way the reputation is management’s fault) of shoddy workmanship and association with low mileage cars. One new lineup isn’t going to change this, the bad reputation took decades to make, it will take at least several years to unwind. Most people still do not associate the big three with quality and that is a fault of the long-term management strategy of GM/Ford/Chrysler.
    In addition, if such labour costs are a major issue what I’ve never understood was why the management of the Big Three decided it would be best to have their companies pay all the health care costs of their (US-based) employees rather then lobby the US government for universal care. Just shortsightedness on management’s part.

  6. Andrew F's avatar
    Andrew F · · Reply

    The Malibu is selling quite well. They aren’t discounting it, to be sure. I might buy one if they do. My current car is chugging along so I’m holding off on a purchase with the expectation that car prices will fall significantly. Deflation for you…

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