General Motors has reached a tentative deal with a Canadian union that would invest approximately $791 million into the country's auto sector, according to a report from the union Unifor. This proposed investment comes as Canada's auto industry faces pressure from U.S. tariffs, including a potential increase to 50% on January 1, as threatened by President Trump.
The agreement, reached on August 22 between GM's Canadian division and Unifor on behalf of 4,600 workers, includes plans to assemble a new generation of heavy-duty GMC Sierra trucks at an Oshawa, Ontario, plant. This move represents a C$144 million commitment to the Oshawa facility. Additionally, GM has pledged not to immediately sell or close a second assembly plant in Ingersoll, Ontario, while it studies alternative production options for the site.
GM also committed to investing C$215 million to assemble a new transmission at a factory in St. Catharines, Ontario, starting in late 2029. A significant portion of the total C$1.1 billion investment, C$691 million, is earmarked for the production of new V8 engines in Ontario, a commitment previously announced in April.
The fate of Canadian auto plants has become a critical point in stalled trade negotiations between the United States and Canada. Canada has stated that a trade deal with the U.S. is contingent on securing the future of its auto assembly and parts industry. Negotiations reportedly broke down last week over unresolved issues, including Canadian demands for the inclusion of medium- and heavy-duty trucks in any agreement to reduce U.S. tariffs.
President Trump has previously clashed with Ontario Premier Doug Ford and has indicated a willingness to impose higher tariffs on Canadian vehicles, parts, and steel. U.S. Commerce Secretary Howard Lutnick noted that Canadian negotiators had only recently raised demands concerning medium- and heavy-duty trucks, shortly before a trade deal deadline.
Workers are currently voting on the tentative agreement over the weekend. Both Unifor and GM's Canadian division have declined to comment during the voting period. The Ingersoll plant, formally known as Canadian Automotive Manufacturing Inc., would also have priority for defense work for the Canadian Armed Forces if GM secures relevant contracts.