Trudeau Promises Help Shifting Auto Parts to Medical Supplies

(Bloomberg) -- The Canadian government says it will help the country’s auto sector shift gears to begin making desperately-needed medical supplies to fight the coronavirus.

“Our health care professionals really need support, so our government will help these companies shift production from auto parts to medical supplies,” Prime Minister Justin Trudeau said in a news conference.

With the virus slamming the brakes on North America’s auto industry, there is excess capacity in the supply chain. Earlier this week, Ford Motor Co., General Motors Co. and Fiat Chrysler suspended operations across North America, laying off thousands of workers.

In Canada, auto capacity had already been reduced with last year’s closure of GM’s flagship plant in Oshawa, Ontario, after more than a century of production.

That news, while devastating at the time, provides an advantage now, Jerry Dias, national president of Unifor, the workers union, said by phone. Reconfiguring assembly lines for short-term production of masks, ventilators, and other supplies would require a huge capital investment but a shuttered plant needs to be switched only once.

“There are incredible opportunities with the closure of General Motors in Oshawa,” Dias said by phone. “We have several vacant plants that used to make parts. So you have the space and you have the skilled workforce just sitting there.”

Trudeau made clear that capital investment is now in the works from the federal government.

GM’s Canadian unit didn’t immediately respond to a request for comment.

WWII Measures

The Ontario government is already talking to manufacturers in the beleaguered auto sector about making medical supplies, Ontario Premier Doug Ford said in a news conference Thursday.

The chief executive officer of Magna International Inc., the largest auto parts manufacturer in North America, has offered to do “whatever it takes to pitch in and help,” Ford said. Parts maker Martinrea International Inc. has 400 employees ready to work once the company is provided design specs for ventilators, he added.

“This goes back to World War II measures. We’re asking the business community to step up and make a transition on their assembly lines,” Ford said.

Magna CEO Donald Walker “did speak with Premier Ford and indicated that we would be willing to see how we could help if needed,” Tracy Fuerst, a spokeswoman at Magna, said by email. However, there is nothing specific in the works yet, she said. A spokesperson for Martinrea did not respond to a request for comment.

“There’s no region in North America that’s more diverse,” Ford said, citing Ontario’s natural resources, manufacturing and pharmaceutical sectors. “We can build anything in Ontario.”

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