BUSINESS
12/16/2011 11:13 EST | Updated 02/15/2012 05:12 EST

General Motors Oshawa Plant To Produce New Chevy Impala

AFP/Getty Images

General Motors said Friday it will invest $68 million at its plant in Oshawa, Ont., to build the new version of its Chevy Impala sedan — a move that will save 350 jobs as the automaker streamlines its Canadian operations through plant closures and layoffs.

The new car will be produced on a so-called flex assembly line in the industrial city east of Toronto, a line where the U.S.-owned automaker has shifted more of its car production in recent years.

The plant, which runs traditional and flexible assembly lines — which can be quickly retooled to make multiple car models — employs more than 4,400 people.

It has undergone many changes this past year, recently launching the Buick Regal, Chevrolet Camaro Convertible and Chevrolet Equinox.

Overall, GM Canada still intends to shut down one of its Oshawa assembly lines in early 2013. But Friday's Impala announcement and an earlier move to shift some Cadillac production to Oshawa, will save 750 of the 2,400 jobs now slated to go.

Keeping as many jobs as possible in Oshawa will be a big issue for the autoworkers union when it bargains with the big carmaker next year.

"We are building on the recent capacity increases, product launches and shift additions at our Canadian operations to affirm that Canada will play an important role in the new GM as we continue to transform our product lineup," said Kevin Williams, president and managing director of General Motors of Canada.

The announcement follows a decision by GM earlier this year to build the new Cadillac XTS at the Oshawa plant. That decision created or saved 400 jobs on the flexible assembly line.

GM is scaling back its overall operations in Canada as part of a North American restructuring begun two years ago under bankruptcy court protection. That streamlining led to the loss of tens of thousands of jobs at the company's Canadian and U.S. operations and the shutdown of several plants.

In Canada, GM has already closed a truck plant in Oshawa and a transmission factory in Windsor, Ont.

At the Oshawa plant, GM's move to shut down the traditional line in the first quarter of 2013 is part of a broader manufacturing plan to run more flex assembly lines, which help the company engineer and produce hot-selling vehicles more quickly to boost sales and profits.

The Oshawa flex line currently employs 2,000 people and makes the Chevy Camaro, Buick Regal and soon, the Cadillac XTS.

GM said the Impala will also be built at its Detroit-Hamtramck assembly plant in Michigan, however how the production will be split between the two plants was not immediately know.

Canadian Auto Workers president Ken Lewenza said that will be a key issue for the union during bargaining in 2012.

"This is great news, but really what we need to do is increase market share and utilize all of our floor space," he said referring to the line that will be shut down in 2013.

GM and its Canadian subsidiary were bailed out by the U.S., Canadian and Ontario governments two years ago and restructured its operations.

Federal Finance Minister Jim Flaherty said it has become clear that helping the company with billions of dollars in aid was the right decision.

"Our support has helped preserve Canada's place in the automotive industry," Flaherty said in a statement.

"It has helped protect jobs in communities across Canada in automotive assembly and automotive parts production."

GM Canada currently employs more than 10,000 people across the country. In its heyday, the automaker had more than twice that total and major operations in Oshawa, St. Catharines, Ont. and Windsor.