South Dundas - February 7, 2012 - The announcement by Caterpillar of the closure of their Electro-Motive locomotive plant in London, Ontario last week was a punch in the gut. Not only for the 450 workers who went from
lock-out to clean their lockers out, but for the community, the province and the country as a whole. No sooner did the announcement go out, the finger-pointing game began.
It was the union's fault, it was the greedy company's fault. Blame
McGuinty! Blame Harper! Blame everyone, and they should as there is
enough blame to go around.
Caterpillar bought Electro-Motive in 2010. With a track-record of
moving production from expensive facilities to lower-cost facilities,
this move from Caterpillar should not have been a surprise to anyone.
When a company starts contract negotiation by stating that everyone
has to take a 50% pay cut, they are playing hardball and are prepared
The Canadian Auto Workers union representing those employees can stand
to take some heat here too. For most of the facility's life, it was
owned by General Motors. The same highly-paid union salaries that
dragged down costs in GM's auto production occurred here as well.
Union wages rose and rose, the sky is the limit to the land of milk
and honey. When business was good, the company could afford to accede
the request for more money and benefits. The problem with that is,
Electro-Motive may have been the number one company in it's field for
the first 50 years, the last 40 years have been spent as second-fiddle
to General Electric. The company is not as cutting edge anymore.
The McGuinty government can carry some blame on two fronts. Not for
the Premier's comments two days prior to the closure announcement, but
for both stagnating industry in Ontario, and for a feckless response
after the announcement. With a highly skilled, technical manufacturing
plant like Electro-Motive, there is no reason why the Ontario
government could not have been out helping locate a company to come
into that plant and hire some if not all of the workers. How can
McGuinty do that with eight years of performance that has put nails in
the coffins of manufacturing plants from Cornwall to Sarnia?
The Harper government also has some blame, namely in approving the
sale of Electro-Motive to Caterpillar in 2010. With Caterpillar
opening new production facilities at the same time as the purchase of
Electro-Motive being announced, it does not take a rocket scientist to
see that Caterpillar could quite possibly relocate production outside
In the end we all lose from this closure, just as we have from
closures at Courtalds and Domtar in Cornwall, to Caldwell Linens in
Iroquois to Black and Decker in Brockville and so many more plants
that have closed in the last 30 years. When we lose the ability to
manufacture goods and products ourselves, we become more dependent on
foreign interests to do it for us. We lose trades, we lose knowledge,
and ability. Losing those is the worst, as once it's gone, is very
hard to get those skill sets and those people back.