Auto Industr

The Big Three

I grew up in Windsor, Ontario which is a blue collar city. (I moved to Toronto in 1980 to pursue my white collar aspirations.) The 60’s and 70’s were the heyday for the city and The Big 3 (Chrysler, Ford & GM) employed thousands of workers. The auto unions had enormous power and their members received excellent wages and benefits.

The Auto Pact between the Canada and the United States guaranteed that Canada would receive a certain amount of auto production from The Big 3 and Windsor benefited the most. The Auto Pact was no longer viable after the World Trade Organization declared it illegal in 2001. As the Japanese and other foreign manufacturers increased production and imports to North America, it put pressure on the Big 3 and the unions. Sales continued to slide, union demands were excessive and the entire industry suffered. Windsor went into a recession time and time again, even when the rest of the province was doing well.

To keep the plants operating in Ontario, The Big 3 held Windsor ransom on more than one occasion by requesting handouts from the provincial and federal governments, and concessions from the unions. Despite the help, Chrysler and GM nearly went bankrupt. Ford fared better but was never shy to ask for a handout. Our provincial and federal governments bailed them out and the unions made concessions to keep their members working. Canadians continued to support the industry by purchasing North American cars.

When the financial crisis hit in 2008, The Big 3 were back at it looking for handouts to survive. (They are now called The Detroit 3 because they are no longer the biggest auto manufacturers in the world.) They have learned so little from their past mistakes. Their products are subpar compared to imported cars and the prices are too high for the quality of product. But still, they seek the highest bidder before making factory relocation decisions. The Detroit 3 engage each country in bidding wars for handouts then chooses the one with the biggest wallet. Canada has to compete against the low wages available in the southern United States and Mexico. It’s a financial decision in the short term but certainly not a good strategy in the long term. People in Ontario will always remember how they have been jilted by The Detroit 3.

Many people stopped buying North American vehicles decades ago. It took my wife and I a long time but we stopped in 2007 when we purchased our first two foreign cars, a Mazda and a Hyundai. I can’t see us ever going back to buying North American vehicles considering what The Detroit 3 have done to Ontario’s manufacturing sector. I’m not being disloyal by not “buying Canadian” because the cars aren’t manufactured here anyway. It’s The Detroit 3 who are disloyal by abandoning Windsor, Oshawa, Oakville, St. Catharine's and other parts of Ontario.

The next time they screw up, and it will happen again, they can run to the Mexican government for handouts.