Toyota moving Corolla production to Mexico

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A big announcement from Toyota today. After nearly 30 years, its Cambridge plant will no longer be making the Corolla. The automaker says by 2019, its best selling sedan will be made in Mexico.

Phil Perkins looked into what this means for Canada, and workers here.

When the first Corolla was made at the Cambridge plant, they were expecting to churn out 50-thousand per year. So far they’ve manufactured about 3.5 million of those models, and in four years a brand new plant in Mexico will be doing the honours, and according to employees and industry experts, that’s not such a bad thing for Ontario.

The very first Toyota Corolla was produced in 1988 at the – then – brand new Cambridge plant. Starting in 2019, the Corolla will be made in a brand new, 1 billion dollar facility in Mexico.

The main reason is, of course, money. Manufacturing costs in Canada tower over those in Mexico. Employees at the Cambridge location earn anywhere between 21-33 dollars an hour, way more than the 2 dollars and ninty cents an hour employees in Mexico are making.

About 54-hundred people work at the Toyota plant in Cambridge and about 3-thousand are responsible for manufacturing the Corolla. After speaking with a couple long-time employees, they said that they’re not nervous about the upcoming changes.

“I don’t think we care about what car we build as long as we’re working.” said one employee. “Toyota has always been good to us, no matter what vehicle or vehicles they take out they’ll put a new one in, they’ll take care of us” said another.

Toyota said that in exchange for the Corolla, the Cambridge plant will be the new home of an unnamed “mid-sized, higher value vehicle”.

“When you have higher costs, you’re looking for ways to make a higher profit margin – and the higher profit margin has always been with the larger and more luxury vehicles” says Charlotte Yates, Dean of McMaster’s Faculty of Social Sciences.

Ontario’s Minister of Economic Development, Brad Duguid, sees the move as a compliment. “What is speaks to is that we have the best quality workers and the best quality facilities in Ontario.”

But with Mexico planning on building 5-million cars annually by 2021, Canada needs to focus on the ever-changing technology of today’s cars from connectivity to fuel sources

“All of those require a certain level of innovation, research and development and higher skill. Those are areas Canada needs to focus on to secure it’s footprint” says Professor Yates.

Toyota has also announced that they are investing $100 million dollars into the Cambridge plant and that could generate approximately another 400 jobs.