By blocking a bridge between Canada and the United States, anti-sanitary measures protesters have touched a central nerve for the auto industry and forced the giants of the sector to temporarily suspend or slow down production lines in several factories.
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General Motors, Ford, Stellantis and Toyota had either to tell workers not to come to the factory on Wednesday or Thursday, or to reduce their production, for lack of availability of certain spare parts.
The Ambassador Bridge, which connects Windsor, on the Canada side, to Detroit, on the American side, is the cross-border bridge with the most traffic in North America, with more than 40,000 workers and tourists using it every day.
Truckers move an average of $323 million worth of goods there every day.
And the area around the bridge “is kind of a giant cluster for the auto industry,” says Jason Miller, a supply chain expert at Michigan State University. “Some pieces can cross the bridge up to five, six or seven times.”
Detroit is the cradle of the American automotive industry and many subcontractors have settled in the area.
But “since the 1960s, the auto industry has taken it for granted that cross-border traffic will be easy and reliable, and it operates in just-in-time conditions with factories that sometimes only have inventory for a few hours or a few days,” Fraser points out. Johnson, a supply chain specialist at the Canadian Ivey business school.
“As soon as we have disturbances of this kind, it jeopardizes the continuity of operations,” he adds.
aim high
General Motors had to cancel the Wednesday evening shift as well as the two Thursday shifts at its Lansing Delta Township plant, and the Thursday morning shift at the Flint plant had to be shortened by about two hours.
Ford had to reduce capacity at its Canadian plants in Oakville and Windsor on Thursday.
Several Stellantis sites in the United States and Canada had to shorten the second shift on Wednesday evening before reopening on Thursday. The Windsor plant had to shorten the morning shift again on Thursday.
Toyota for its part indicated that the bridge blockage affected its factories in Canada and its factory in Kentucky, in the United States, without specifying since when or to what extent.
But the company is already expecting “disturbances until the weekend”.
By making this bridge a central point of their protests, Canadian truck drivers “aim high to relay their demands by striking at the heart of the automotive industry”, summarizes Karl Brauer, of the specialized site ISeeCars.
Complicated workaround
It would be complicated to take another path in this region dotted with large lakes.
The bridge is designed to directly connect major highways on both sides of the border.
And going through Buffalo a little further east, near Niagara Falls, “is problematic because they don’t have the infrastructure there to handle truck traffic,” says Fraser Johnson.
It is also not possible to obtain supplies easily from other subcontractors, many of whom manufacture very specific parts, even configured for a particular vehicle.
And “we must not forget that this crisis is happening in an already difficult context, with the shortage of semiconductors which does not seem to be improving”, notes Karl Brauer.
The automotive sector has indeed been shaken for more than a year by the lack of these elements which have become essential in the manufacture of cars, periodically forcing certain manufacturers to temporarily suspend the assembly lines.
The situation could quickly worsen if the bridge remains blocked, with possibly the temporary layoff of employees at the builders.
“For a position on an assembly line, about 10 positions are affected in the whole economy”, recalls Bernard Swiecki, of the specialized research center CAR, mentioning the subcontractors or the restaurants welcoming them.
The blockage could gradually affect more distant factories, to which trucks were already on their way before the bridge was blocked, he also points out.
Used car prices, which soared to record levels last year in the United States, could continue to rise, says Jason Miller.
And “the impact could extend to other sectors if raw materials run out,” he adds, noting that the United States imports a lot of aluminum and Canada of plastic.
Reference-www.journaldemontreal.com