Nov 26, 2018
The Daily Chase: GM reportedly closing Oshawa, Ont. plant
By Noah Zivitz
General Motors is reportedly planning to pull the plug on its 65-year-old assembly plant in Oshawa, Ont. Officially, the auto maker is declining to comment on the information that our CTV News colleagues first reported early yesterday evening. However, Unifor says it has been informed the Oshawa plant doesn’t have any product allotments beyond December 2019. The Globe and Mail, meanwhile, is reporting GM staff have been informed there will be an announcement at 10:00 a.m. ET.
Tons of threads to this story. Some basic questions that will help frame our coverage:
-First and foremost, why? There might be an urge to jump to a conclusion this is because of tariffs or auto provisions in the United States-Mexico-Canada Agreement (USMCA). We’ll wait to see what the actual reason is.
-How should the feds handle this? Keep in mind that in recent days we’ve heard a few voices say the federal government would be quick to act if the auto industry fell on similarly hard times as what the oil patch is dealing with now.
-Considering Canada helped save GM in 2009, has enough been done to protect auto sector jobs including the 2,000+ at GM’s Oshawa plant?
-What are the implications for the next round of contract negotiations with Unifor?
-What message does this send about the competitiveness of Canada’s auto manufacturing plants?
AEROPLAN DEAL HAMMERED OUT
Aimia has cemented its previously announced agreement to sell Aeroplan to Air Canada. Separately, TD said it will become the primary card issuer for Air Canada's new in-house loyalty program from 2020-30 and chip in $622 million for the Aeroplan takeover. CIBC, meanwhile, says also has a deal to offer credit cards in partnership with Air Canada's new loyalty program. CIBC says it will contribute $200M to Air Canada's purchase of Aeroplan. Yes, lots of moving parts to this story.
STOCKS SURGE
American investors are back from their Thanksgiving weekend with a bounce in their step as futures point to big gains at the start of trading in New York. Lots of catalysts in the week ahead. Arguably none bigger than the G20 summit.
TRUMP TWEET
In a single tweet yesterday morning, U.S. President Donald Trump appeared to praise himself for oil’s recent decline while referring to himself in the third person, and took fresh aim at the U.S. Federal Reserve. Keep in mind, Fed Chair Jerome Powell has a public speaking engagement in New York on Wednesday where it stands to reason he might face questions about being targeted by Trump.
CANADA POST LATEST
Senators will resume debate on back-to-work legislation this afternoon after taking a breather this weekend amid concern among some senators about the constitutionality of Bill C-89. We’ll keep tabs on developments; presumably as will consumers eager to cash in on Cyber Monday deals.
THERESA MAY’S BIGGEST CHALLENGE
U.K. Prime Minister Theresa May departed Brussels yesterday with a thumbs up from EU leaders for her plan to untangle the United Kingdom from the European Union. Her biggest challenge lies ahead with a vote in Parliament sometime in December.erg
Note: Links to agreements endorsed by EU here
OTHER NOTABLE STORIES
-The crypto rout continues this morning. Bitcoin has been down as much as 13.7 per cent in early trading, sending it below US$4,000 per coin.
-Cation Capital took another swing at Crescent Point Energy this morning, warning it “reserves every right to bring about change for the benefit of all shareholders.”
NOTABLE RELEASES/EVENTS
-9:00 a.m. ET: ECB President Mario Draghi addresses European Parliament
-11:00 a.m. ET: Finance Minister Bill Morneau delivers speech to Greater Vancouver Board of Trade (plus media avail)
-2:00 p.m. ET: Senate debate on Canada Post legislation
-4:15 p.m. ET: Prime Minister Justin Trudeau meets with Ford Motor Canada President Mark Buzzell in Ottawa
-4:30 p.m. ET: Conservative Party Leader Andrew Scheer in conversation with Kevin O'Leary at Ryerson
-National Energy Board holds Trans Mountain hearing in Victoria
Every morning BNN Bloomberg's Managing Editor Noah Zivitz writes a ‘chase note’ to BNN Bloomberg's editorial staff listing the stories and events that will be in the spotlight that day. Have it delivered to your inbox before the trading day begins by heading to www.bnnbloomberg.ca/subscribe.
