Two major automakers are teaming up to build a meeting facility in the city of Ingersoll, Ontario.
It would be Suzuki and General Motors, who announced their joint allocation of $500 million on August 27, 1986.
And while the city welcomed the investment that would turn a cornfield into a production facility, some observers wondered how much more such a facility was needed in Canada.
The National sent journalist Kevin Evans to the city to get an idea of what was happening to Ingersoll and the auto industry.
“They smiled at Ingersoll and for good reason,” Evans said at the beginning of his report, which aired on the day of the announcement.
“To this day, this numb city of 8,500 more people stood out only for its cheese. This and the city are about to change.
Walking around the site where the plant would be built, Evans said the next facility is expected to open within 3 years.
When fully operational, I expected to produce 200,000 cars each year and employ another 2,000 people to do so.
The news was notable for several reasons, in addition to the effect it would have on the city of southwest Ontario.
“The GM-Suzuki joint venture announced is the first such company to be established in Canada,” Evans said.
“More importantly, this is the first time that an Asian automaker building a plant in Canada agreed to comply with the terms of the U.S.-Canada auto pact.
Evans said the Suzuki deal would spend $200 million a year on auto parts manufactured in Canada.
The Ontario government has done its best to promote the deal by offering $45 million in assistance.
The Globe and Mail reported that the provincial government had the form of loans that would not have to be repaid if certain targets were met.
The Ingersoll plant is advancing at a time when many investments are made in the Canadian automotive sector.
“GM and Suzuki’s $500 million will sink into this cornfield, bringing the planned total investment in Canada to more than $4 billion in the last 18 months alone,” Evans said.
But there were voices and industry observers who thought the brakes would have to be stepped on when demand for new cars declined.
“These new meetinghouses, foreign meetinghouses, contribute to an overcapacity challenge in North America,” Royal Bank economist Paul Noble said in an interview with CBC News.
Bob White, president of Canadian Auto Workers, said the call may not continue to increase indefinitely and the same degrees of production simply do not remain in place.
“You can’t continue to develop capacity in North America when the market isn’t developing as fast and you expect to keep all the amenities in place,” he said.
But Roger Smith, president of General Motors, said the market would determine which plants and products would thrive in the long run.
“The market will tell us which cars are successful, which plants remain open and which are final and is a very, very complicated and competitive race,” Smith said in an interview with journalists in Toronto.
Evans said automakers had entered into the agreement with a strategic eye on Canada’s long-term automotive industry.
“GM and Suzuki provided a partnership out of necessity, which they hope will position them among the survivors of the main turmoil facing the auto industry in the coming years,” he said.
Ingersoll’s CAMI meeting facility is still in operation today, GM is now the sole owner.
In 2018, GM announced that the plant had produced five million cars since it began car production in 1989.
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