Greater Sudbury Northern Life
Toronto – Does any of this sound familiar? A premier tells a prime minister Ontario is losing jobs and suffering hardship because the auto manufacturing industry it depends on is collapsing, and they need to join to find solutions.
The province warns the manufacturers are on the wrong track, particularly in building big gas-guzzlers instead of smaller, fuel-efficient cars, which consumers prefer and are buying increasingly from abroad.
Its industry minister says government will consider helping, but the manufacturers have to open their books, so it can monitor their actions.
The auto heads insist their industry knows what it is doing, plans real change and can be made profitable again.
Much of this sounds as if it comes from today’s newspapers, but it happened in and around 1980, when Ontario had a similar economic downturn.
North American car sales had fallen by 25 per cent and Ontario had plunged, as it has today, to the unaccustomed depth of having one of the lowest rates of economic growth among provinces.
Progressive Conservative premier William Davis asked Liberal prime minister Pierre Trudeau to join him to help combat what he called the “serious decline in automobile and parts production.”
Davis said some considered the domestic industry’s problems temporary, but he felt it needed to take more account of the rising cost of oil and consumers’ growing preference for smaller, fuel-efficient cars, which mostly meant imports.
Davis got under the hood of the issue, because the Big Three manufacturers’ emphasis on continuing to produce cumbersome gas-guzzlers cost them market share and helped drive them to the precipice they are on today.
A report prepared by a committee of the legislature, which investigated plant shutdowns, similarly accused the Big Three manufacturers of sticking to turning out gas-guzzlers and failing to produce and market smaller, more fuel-efficient vehicles.
The report warned failure to switch to more fuel-efficient vehicles would mean doom for Chrysler, gloom for Ford and a heavy debt load for General Motors, which is not far from what is happening 28 years later.
Larry Grossman, an Ontario industry minister, said the industry would have to design and build the cars consumers wanted, not those it felt were good for them.
He said the industry should look at whether its labor costs were too high because it paid its workers three or four times as much as competitors in Europe and Japan. The then president of Ford Motor Co. of Canada Ltd., Roy Bennett, responded his company had been in the vanguard of automotive engineering and intended to stay there.
He said it was the North Americans, not the Europeans or Japanese, who developed such innovations as automatic transmissions, computer-aided design and manufacturing, electronic instrumentation, catalytic converters and lubricated-for-life components, to name just a few.
The car manufacturers had the road to success sign-posted for them, but failed to follow it — anything they promise now has to come with an unbreakable warranty.
Eric Dowd is a veteran member of the Queen’s Park press gallery.
