The decision to cut 1,500 jobs from a Fiat Chrysler Automobiles plant in Windsor, Ont., comes after the two types of minivans manufactured at the plant saw sales plummet dramatically last year.
The plant makes two types of minivans: the Chrysler Pacifica, an award-winning luxury minivan, and the Dodge Grand Caravan.
Last December, Fiat Chrysler Automobiles sold just 205 Chrysler Pacifica minivans in Canada. That’s a 68 per cent drop from December 2017, when 638 Pacifica minivans were sold.
In the same month, 1,661 Caravans were sold -- down 49 per cent from 3,283 sales in December 2017.
On a year-to-year scale, Pacifica sales dropped 3 per cent from 2017, with 6,185 minivans sold, to 2018, with 5,999 sold. It was a far worse year for the Caravan, which saw a 31-per-cent drop in sales from 2017 to 2018.
Independent business journalist Bryan Borzykowski says the job cuts reflect a large-scale shift in taste among consumers.
“They’re buying more SUVs, they’re buying more trucks, and I think that’s a big reason for this, too. People just aren’t as interested in minivans,” he told CTV News Channel on Thursday.
The company plans to cut back to two shifts at the plant in September, affecting a quarter of its 6,104 workers. In a statement, the company said the cuts are being done “in order to better align production with global demand.”
Unifor Local 444 President Dave Cassidy described the cuts as “devastating” and agreed that slumping sales are to blame.
“The situation here is strictly a business decision based on the demand of the Pacifica,” Cassidy said.
Unifor National President Jerry Dias says the union has demanded an urgent meeting with Fiat Chrysler Automobiles Canada to address the situation.
“I am deeply concerned about the 1,500 plus families, the community of Windsor & the Cdn auto industry - all affected by FCA Canada's decision to end the 3rd shift at Windsor Assembly Plant,” Dias tweeted.
The job cuts are expected to have a ripple effect across Windsor. CTV Windsor reporter Michelle Maluske says Magna-Integram Seating, a nearby plant that supplies seats for the minivans, will likely feel the blow.
“Its sole purpose is to supply seats to this factory. That plant will have to go down to two shifts as well. There will be workers there who will lose their jobs. Not to mention all of the tier-two suppliers that supply every single part that goes into the minivans that are built here. The impact will be significant.”
As consumer tastes evolve and auto companies prioritize low-emissions vehicles, more trouble could be on the way for auto workers, Borzykowski said.
“I think as the industry shifts, we get more electric cars and different types of vehicles, I think we’ll see more of this kind of thing happen.”
