GM to Close Windsor Ontario Plant

TORONTO May 12, 2008; John McCrank reporting and Kevin Krolicki writing for Reuters reported that GM Canada said today that it plans to close its Windsor transmission plant in the second quarter of 2010, saying upcoming versions of its cars would not require components from that facility.

The 45-year-old plant makes transmissions for export to the United States and Mexico and currently employs about 1,400 workers, GM said.

GM's decision to close the plant marked a setback for the Canadian Auto Workers union, which has begun negotiations with both GM and Chrysler LLC on new contract terms after moving to speed up the schedule for negotiations that had been expected this summer.

About 9,000 CAW-represented workers ratified a new contract with Ford Motor Co earlier this month, agreeing to freeze wages and give up a week of vacation as part of a three-year deal.

GM said it had reached the decision to close its Windsor transmission plant after talks with both the CAW and government representatives.

The automaker, which has been cutting costs and production capacity in North America as part of a turnaround effort, said it had determined that its future product plans would not require the transmissions from Windsor.

The plant has been making 4-speed front-wheel drive transmissions for GM vehicles like the Chevrolet Malibu, HHR and the Pontiac G6.

GM said it had briefed employees on the closure plan on Monday. The automaker said it would work with the local bargaining unit of the CAW on "transition plans" for employees of the Windsor plant ahead of the planned 2010 closure.

CAW President Buzz Hargrove was scheduled to speak to reporters later on Monday after the announcement.

The union and GM kicked off contract talks last week.

Editing for Reuters by Rob Wilson and Gunna Dickson