DaimlerCrysler to invest $768 million in Ontario operations

The federal and Ontario governments have collaborated once again to secure a major automotive investment for the province. DaimlerChrysler Canada Inc (DCCI) has committed $768 million, bringing this year’s new auto investments in Ontario to $5.3 billion.

DCCI is dedicating the new funding to establish flexible manufacturing at its Chrysler plant in Windsor and its automotive R&D centre (ARDC) at the Univ of Windsor.

DCCI will invest $608 million in its assembly plant over the next three years and build a new paint shop that will be operational by 2007. The assembly plant was constructed in 1928 and — at four million-sq-ft — is the largest of the Chrysler Group’s 14 assembly plants.

The investment includes a $46-million contribution from the federal government towards environment enhancements at the paint shop, the implementation of prototyping capability for assembly operations and leveraging of incremental R&D at the ARDC. Funding is being flowed through Technology Partnerships Canada.

Ontario is committing $76.8 million to the project in two areas. New assembly technologies and the installation of environmental technologies in the paint shop will receive $59 million. The remaining $17.8 million will go towards supporting DCCI’s $100-million commitment to the ARDC. Funding is being flowed through the province’s $500-million Ontario Automotive Investment Strategy, announced in April/04).

All major automotive manufacturers have been adopting flexible manufacturing facilities as a way to reduce costs and enhance competitiveness. Flexible manufacturing allows the production of multiple vehicle models on the same assembly line without the need for expensive and time-consuming re-tooling.

DaimlerChrysler is the latest automotive manufacturer to make major investments in Ontario. Earlier this year, investments were made by General Motors ($2.5 billion) (R$, March 9/05), Toyota ($800 million) (R$, July 22/05), Ford ($1 billion) and the International Truck and Engine Corporation of Canada ($270 million) (R$, May 18/05).

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