Automotive News Canada - November 2019 - v2 - 20

* N O V E M B E R 2 019

Toyota brand damage due to parts debacle is likely minimal
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an effort to speed things up, it would
not elaborate on what exactly caused
the parts delay.
It did, however, "sincerely apologize" to its customers for the "unusual delays" and urge them to contact its
customer-service line for help.

took over seven weeks to get. No reimbursement, no apology," she wrote
in a Facebook Messenger exchange
with Automotive News Canada.
Susan Gubasta, CEO of Mississauga
Toyota, said the automaker worked
COMMUNICATION CALLED INTO QUESTION
hard to resolve the parts problem, but
the situation has been "challenging."
Toyota Canada could have done a
Customers are frustrated, and her
better job of communicating what was
sales staff is bearing the
happening, said Mark
brunt, Gubasta said. Parts
Gregory, managing
delays also had an impact
partner of Locomotion
on the new-car sales proCommunications and
cess, she said.
Public Relations Ltd., in
"Let's say I'm coming
Burlington, Ont.
in to buy a Corolla. And
"They didn't respond
there's certain accessoquickly or clearly.
ries I want. It's delay,
There's a lot of things
delay, delay. It sours the
customers need to know:
positive purchase experiWhat's the problem?
ence," she said. "It didn't
When is it going to be
impede the sale. But it
fixed? And what are they
made it less seamless.
doing to fix it?" Gregory
"But, at the end of
told Automotive News
the day, the transforCanada. "It's too bad
mation needed to hapbecause Toyota has a
pen, and we've had to
good reputation for qualiDonna LaPorte said
work together to make
ty in Canada."
the best of a challenging Toyota Canada's parts
Judging by media covsituation, and we're com- shortage was enough to
erage of the situation, he
steer her away from the
ing through the other
said, "it would appear
automaker's products.
side," Gubasta said.
customers are getting
PHOTO VIA DONNA LAPORTE
Parts deliveries were
mixed messages. Toyota
"nearly" back to norneeds to look at what
mal, Toyota Canada said in an email
messages are going to their suppliers,
Nov. 1.
and dealers, to ensure they're consis"The number of customers still
tent and clear.
impacted by delays is now in the single
"You want to try and avoid technidigits," Toyota spokesman David Shum cal terms and industry jargon because
wrote. While the automaker said it had
people don't really relate to that. They
added more shifts at its warehouses in
don't understand it," said Gregory, who

"These ERP [enterprise resource
planning] installations, about one in
five are disasters," Seguin said.
"Toyota's got a great reputation. It's
got great brand value. I don't think this
is going to tarnish them," Seguin said.
"The bigger question is, what's the
impact on dealers? How are they being
supported by Toyota?"

STRONG REPUTATION

Susan Gubasta, Mississauga Toyota
CEO, said her staff had to deal with
frustrated customers, but she gave
high marks to Toyota's management
of the parts shortage. F I L E P H O T O

advises companies on crisis management.
"The most important thing they
could do is communicate more clearly
and more frequently. If there's a problem, step up to the plate and make it
right. Maybe it's some form of compensation or a benefit."
Toyota declined to respond to
Gregory's comments.
But Chuck Seguin, president
of Seguin Advisory Services, said he
did not think the parts shortage will
inflict long-term damage on Toyota's
brand.
Large system overhauls of this type
often go awry, said Seguin, whose
firm offers consulting services to dealers and automakers. But once they're
resolved, customers quickly forget
about them, he said.

But Mississauga Toyota's
Gubasta said the automaker's efforts
were tireless.
"They brought people up from the
U.S. They had people working 24/7, and
they just couldn't get ahead of it. It isn't
for lack of trying."
Toyota also helped dealers provide
customers with replacement vehicles
where necessary, Gubasta said. "We
have to keep people on the road."
Gubasta said she doesn't expect the
hitch to have a lasting impact on the
brand.
"Six months from now, it will be
forgotten. The manufacturer didn't do
anything to endanger people. It's not
about a safety recall," she said.
David Friesen, general manager of
Mayfield Toyota in Edmonton, said the
parts problem "has been a challenge
for sure. But at the end of the day, we
work together and try to get ourselves
through it somehow.
"We've tried to resolve everybody's
problems," he said. Mayfield is the largest parts seller in the Toyota Canada
network, he said. "We have lots of very
good relationships. We've got a strong
reputation.
"In general, I have to say we've
weathered it fairly well." - ANC

2020 contract negotiations: What's at stake for Canada's auto industry
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set the stage for Unifor negotiations the following year.
They can foreshadow which
areas automakers might be
willing to concede ground
to the union and those they
will not.
They also can limit production options for plants,
should Unifor seek additional product mandates from
automakers. Committing,
say, $6 billion to plants in the
United
NEWS ANALYSIS States,
as Ford
Motor
Co. did in its negotiations
with the UAW, limits options
for Unifor should it seek
additional production mandates at Ford's Oakville,
Ont., assembly plant.
Ford and the UAW
reached a tentative agreement in the days following the ratification of the
GM-UAW contract. Workers
had until Nov. 15 to vote on
the agreement. Negotiations
between the UAW and Fiat
Chrysler were ongoing as of
print time.
Negotiations between
Unifor and the Detroit Three
were set to begin next year
ahead of the current contracts expiring in September
2020. Here is a look at what's
at stake for each automaker and the more than 17,000
hourly workers at their
Canadian assembly plants.

FORD: Unifor-Ford negotiations will likely

centre around the future of the Oakville
plant, which will have shed about 650 jobs,
or about 14 per cent of its work force, by
early 2020. The job losses come as production of the Ford Flex and Lincoln MKT
crossovers end, leaving the plant with the
Ford Edge and Lincoln Nautilus crossovers.
Unifor President Jerry Dias said the
union would seek clarity from Ford on its
long-term plans for the plant ahead of negotiations as the union seeks investments
there to get laid-off members back to work.
He said the union was
willing to work with the
automaker on retirement
incentives for senior members as part of a solution.
"We have some senior
people at the plant that we
need to talk to Ford about
ways of maybe trying to
Unifor
entice our senior memPresident
bers to retire while preserving jobs for our most Jerry Dias said
the union is
junior." Negotiations
willing to work
will also cover the autowith Ford on
maker's Windsor, Ont.,
retirement
engine operations, which incentives.
Ford committed $600
FILE PHOTO
million in investments to
during 2016 bargaining. Ford in May said
it would cut one of three shifts at one of the
engine plants due to falling demand for the
5.0-litre engines it makes, though affected
workers had the opportunity to move to the
Windsor engine plant that builds 7.3-litre
engines.

GENERAL MOTORS: Unifor will bargain on
behalf of much fewer GM Canada workers
in 2020 than it did in 2016. Vehicle assembly
at GM's Oshawa, Ont., factory will stop
by the end of 2019, leaving only about 300

workers there when the plant becomes an
aftermarket parts and stamping operation
in 2020.
Discussions with GM are sure to focus
in large part on the Oshawa plant, especially after Unifor's high-profile campaign
against the automaker in the wake of the
2018 decision to end production there.
Unifor is likely to seek new product mandates at the plant in the hopes of raising
the number of workers, as Dias has said he
expects that figure to rise over time.
Negotiations, as usual, will also cover
workers at the St. Catharines, Ont., propulsion plant and GM's Woodstock, Ont.,
parts distribution centre. They do not cover
workers at GM's CAMI factory in Ingersoll,
Ont., which is on a separate contract that
lasts until 2021.
Dziczek said that could change.
"If [Dias] wanted to move them onto
the same agreement, I think he could," she
said. "It wouldn't be that hard."
Much like GM and the UAW, there
appeared to be little love lost between
Unifor and GM. CAMI was the site of a
monthlong strike in 2017, when Unifor
demanded that the plant become the lead
producer for the Chevrolet Equinox crossover after some production was shifted to
Mexico. GM, in response, threatened to
close the plant, and Unifor shortly thereafter agreed to a deal without lead producer
language.

FIAT CHRYSLER: Like 2016 negotiations, 2020

talks could hinge in large part on the future
of FCA's Brampton, Ont., assembly plant.
The factory builds the Dodge Charger,
Dodge Challenger and Chrysler 300, the
latter of which is on the chopping block in
the coming years, according to Joe McCabe,
CEO of AutoForecast Solutions LLC. The
Charger and Challenger, while profitable
for FCA, sit on aging platforms, and it was

Fiat Chrysler's Windsor, Ont., minivan
plant employs about 6,000 workers,
1,500 of whom will be out of a job if the
automaker proceeds with plans to cut the
third shift. P H O T O : G R E G L AY S O N

unclear what the automaker's long-term
plans were for the cars.
"We have no other product there other
than the Charger and Challenger," he said.
"If they do decide to get out of that business, which we don't think they will, then
obviously Brampton will be in the crosshairs."
He said the plant could become an
option in the long term for a new electric
vehicle based on the Charger or Challenger,
similar to Ford's plans to launch an EV
based on its Mustang.
FCA's Windsor, Ont., plant will also
receive attention. FCA plans to cut one of
three shifts next year at the plant amid
slowing North American demand for the
minivans it builds. Unifor has had discussions with FCA and the federal government about ways to prevent 1,500 workers
from being laid off, including a potential
work-sharing program.
Unifor Local 444 said Nov. 13 it had been
notified by the company that the third shift
will be extended until the end of the first
quarter of 2020. That gives Unifor more
time to find a solution, though FCA has
said it still plans to end the shift.
"We just don't see the necessity of maintaining the three shifts there in the long
term," McCabe said. - ANC

Automotive News Canada - November 2019 - v2

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