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Big Three, Dethroned: Honda and Toyota on pace to assemble more vehicles than Detroit Three in 2020

Alliston, Ontario — Honda and Toyota are on a pace to assemble more vehicles in Canada this year than the Detriot Three, ending the 100-year run of Chrysler, Ford, and General Motors at the top of production rankings.

The two Japan-based companies turned out a total 631,142 vehicles at their Canadian assembly plants through the end of October, compared with 544, 239 produced by Fiat Chrysler, Ford, and GM, according to estimate from the automotive news data centre in Detriot.

Honda began production in Alliston, Ont., in 1986, while Toyota opened its Cambridge, Ont., factory in 1988.

Luring the two companies to Canada was a bold, but successful automotive policy action the Canadian government took, said analyst Dennis DesRosiers, president of DesRosiers Automotive Consultants Inc.

“It was a brilliant move,” DesRosiers said. “In retrospect, nobody at the time was predicting that GM, Ford, and Chrysler would be closing plants in Canada and that we would end up with the Japanese being bigger than the Detroit Three.”

In fact, the cause for this shift in production rankings, steep cuts in production at the Detriot Three’s Canadian assembly plants is the direct cause of the new order–amid a year when overall vehicle assembly in Canada has fallen 25 percent.

Fiat Chrysler eliminated one shift at the minivan production at the Windsor assembly plant in July and GM’s Oshawa factory closed in 2019 and Ford has scaled back assembly at the Oakville, Ont., plant. Detriot Three’s production has fallen 36 per cent in comparison to earlier years.

However, the root of the change goes back to the Canadian governments’ trade policy in the early 1980s, when amid a flood of Japanese vehicle shipments to Canada, then Trade Minister Ed Lumley put in place a strict inspection program that delayed delivery of Japanese vehicles to Canadian consumers. That move was what helped convince Honda and Toyota to build assembly plants in Canada.

The shift “really does confirm just how unique Ontario is as a subnational jurisdiction for auto production—where else in the world can you find five of the industry’s leading producers, all within a few hours drive of each other?” Added Dimitry Anastakis, University of Toronto professor who has written extensively about the history of the auto industry in Canada.

This shift seems to shine a light on decades of Detriot Three in production and market share, however, the agreements reached earlier this fall point to somewhat of a rebirth in Canada, with GM agreeing to reopen the Oshawa plant to build its popular pickup trucks in 2022 and Fiat Chrysler planning to restore the third shift in Windsor in 2024.

The main factor contributing to the growth of Honda and Toyota’s assembly in Canada is that their plants are producing the most popular vehicles for their North American lineups.

Honda of Canada Manufacturing builds the CR=V crossover and Civic compact sedan. Toyota Motor Manufacturing Canada Turns out the RAV4 crossover at the Cambridge factory and a plant in Woodstock, Ont., that began production in 2008. RAV4 is Toyota’s best-seller in the U.S. market–the destination for the bulk of Canadian auto production–and the top-selling non-pick-up.

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