Honda to add third shift, 400 jobs at Ontario plant

Honda Canada will hire 400 workers as it ramps up production at a plant in central Ontario, making it the second major automaker in less than a week to put out a “help wanted” sign at its Canadian operations.

Honda Canada will hire 400 workers as it ramps up production at a plant in central Ontario, making it the second major automaker in less than a week to put out a “help wanted” sign at its Canadian operations.

The automaker said Tuesday it will add a second shift at its No. 2 assembly plant in Alliston, where it produces the Honda Civic sedan, Acura MDX sport utility vehicle and Acura ZDX crossover. Production at the plant will increase to 600 units per day beginning in early 2011 from about 400 per day currently.

“We are pleased to be making this announcement as the Canadian economy continues to show signs of recovery,” said Manabu Nishimae, president and CEO of Honda Canada.

The news follows an announcement by General Motors Canada on Friday that it will recall more than 700 laid-off workers and hire 70 new employees to increase production of its popular GMC Terrain and Chevrolet Equinox crossovers at its two southern Ontario assembly plants.

Production is revving up across the Canadian auto industry after a dismal year that saw North American sales shrink to approximately half of what they were during the banner years of 1999 to 2007.

The production increases are partly the result of better sales and partly because the automakers need to rebuild inventories after many of them shut down production for weeks at a time last year, said Tony Faria, co-director of the automotive research centre at the University of Windsor.

“The companies had cut back production so severely in the last half of last year that they do have to get their production back up again to something approaching more normal levels from the past and that’s what they’re engaged in doing right now,” Faria said.

Honda’s No. 2 plant had a second shift until February 2009 when it was discontinued due to the global recession. At that point, production shrunk from 800 to 400 units a day.

March auto sales numbers will be released on Thursday, and Faria said all indications are that they’ll continue to improve in both Canada and the United States, which is the largest market for Ontario-produced vehicles.

Analysts expect sales numbers in 2010 to be approximately 20 per cent higher than they were last year.

Honda Canada spokesman Richard Jacobs said the company expects its sales to rise steadily through 2010 and 2011, and Tuesday’s announcement is in anticipation of that.

“We’ve seen that there are signs of a gradual market recovery, and we believe that’s going to continue through the year and into next year, so we’re taking steps now to ensure we’ll be prepared,” Jacobs said.

He added that initial sales numbers for March indicate Civic sales are continuing to grow, while sales of the MDX should be “at or near record levels.”

In February, Honda’s Canadian sales increased 33.2 per cent compared with a year earlier.

Industry Minister Tony Clement, who represents a federal riding in central Ontario, described Honda’s announcement as a “great day for the Canadian automotive industry.”

“Honda will create more than 400 new jobs, which further signals that the recovery of the automotive industry is indeed gaining momentum,” Clement said.

Sandra Pupatello, Ontario’s minister of economic development and trade, echoed Clement, calling the announcement “further evidence that our auto industry is showing real signs of recovery.”

Although Honda and the other Japanese automakers weren’t as badly hurt by the recession as GM and Chrysler, which received billions of dollars in government assistance, the entire industry suffered from the downturn.

Scotiabank economist Carlos Gomes, who tracks the auto sector, said Honda’s announcement Tuesday is consistent with what he’s been seeing in the industry.

“I think it reflects the fact that demand is picking up. It’s picking up globally, and it’s picking up here in North America as well,” Gomes said.

Honda also produces the Honda Civic coupe and sedan, as well as the Acura CSX luxury compact sedan, at its No. 1 assembly plant in Alliston. And it produces engines at a nearby parts plant. Overall, it employs about 4,500 workers in Canada.

Tuesday’s announcement builds on several pieces of good news to hit the Ontario-based auto industry in recent months. Besides its announcement last week, GM said in October it would add a third shift at CAMI, re-hiring about 350 workers. Then, late last year, GM said it would invest another $90 million to increase capacity at CAMI, resulting in the recall of another 280 workers.

And in November the company said it would add a second shift in Oshawa in 2011 to support production of the new Buick Regal and Camaro convertible, bringing back 700 workers.

In December, Toyota Canada announced it would hire 800 more people at its plant in Woodstock, Ont., to increase production of its popular RAV4 SUV.