Automakers in Canada have cut production and brace for further disruptions as trucker blockades at the U.S. border heighten parts supply issues for the entire industry.
Posted at 11:25 a.m.
Updated at 5:35 p.m.
Delivery delays are impacting the economy with ongoing protests over restrictive COVID-19 measures, which have notably crippled traffic to Canada on the Ambassador Bridge between Detroit and Windsor, Ontario.
Thousands of workers have seen their hours shrink as automakers cut capacity, a situation that is having a ripple effect on local suppliers and the wider economy.
“It’s not just an auto problem, it’s a huge economic problem for Canada as a whole,” said Dino Chiodo, auto sector director at Unifor, the industry’s largest union, on Thursday. country.
“You have lost wages that can’t be offset, then independent parts suppliers that go out of business […] the ripple effect is huge. »
The automotive sector, which relies heavily on cross-border trade in goods, is becoming one of the hardest hit by the protests.
About 400 million goods cross the Ambassador Bridge every day, representing nearly one-third of all trade between Canada and the United States, said Brian Kingston, President and CEO of the Canadian Association of vehicles.
“For the automotive industry, which is fully integrated across North America, this is critical infrastructure,” he said.
“We are faced with this very unfortunate situation, where this bridge has been blocked. We are now seeing production stoppages and cutbacks at Ontario auto assembly plants. »
A shortage of parts that could continue
With commercial traffic stuck on the bridge connecting Detroit and Windsor, automakers have tried to find alternative shipping routes.
However, with many land crossings now hampered by barricades, some businesses are resorting to air freight, a costly and unsustainable measure.
Ford Canada plants in Oakville and Windsor, Ont., are operating at reduced capacity, while Toyota Motor Manufacturing Canada says its three lines have been affected.
Supply chain delays are “harming customers, autoworkers, suppliers, communities and businesses on both sides of the border who have already experienced a two-year parts shortage,” the gate explained. -Ford spokesperson, Rose Pao, in a statement.
“We hope this situation will be resolved quickly, as it could have a widespread impact on all automakers in the United States and Canada. »
The facilities of Stellantis, maker of Chrysler and Dodge vehicles, and those of Honda Canada are operational, but their manufacturing capacity was reduced on Wednesday, due to delays at the border.
Automakers are now planning for possible prolonged product shortages if border crossing remains complicated.
“We expect disruptions by this weekend, so we continue to adjust our production plans,” Toyota spokesman Michael Bouliane said in a statement.
The temporary production halts come as automakers grapple with other supply chain challenges, including a shortage of semiconductors that has hampered the market for new vehicles.
The Ambassador Bridge event — the busiest cross-border crossing in North America — typically handles about 7,000 commercial vehicles per day carrying goods traded between Canada and the United States.
The Canadian Trucking Alliance has called on all levels of government to end protests that disrupt borders and critical trade routes.
“Many of those protesting are having their lives disrupted by certain policies, ironically, disrupting the lives of their fellow Canadians,” Stephen Laskowski, president of the Canadian Trucking Alliance, said in a statement.
“Whether it’s the dedicated truck driver who is stuck at the border and unable to get home with his family or the factory worker who is sent home because critical products and raw materials cannot be delivered, the only people who are harmed by these protests are the Canadian workers who have kept our country going,” he said.