General Motors (GM) and the union Unifor have reached a tentative agreement that includes a C$1.1 billion ($791.31 million) investment in the company’s Ontario facilities. The deal, detailed in a union bargaining report released Saturday, includes plans to assemble a heavy-duty GMC Sierra pickup truck at the Oshawa assembly plant. The agreement requires approval from approximately 4,600 union members who are participating in a ratification vote scheduled for Saturday and Sunday.
The proposed investment comes as Canada’s automotive sector faces significant economic pressure from U.S. trade policies. The United States currently imposes a 25% tariff on Canadian-produced vehicles, and President Donald Trump has pledged to increase that rate to 50% starting January 1, 2027. Negotiations between the two countries to reduce these duties ended last week without a resolution, according to the report.
Under the terms of the tentative deal, GM would allocate C$144 million to bring the next-generation GMC Sierra to the Oshawa plant. The total C$1.1 billion package also incorporates a previously announced C$691 million commitment from April to support production of new V8 engines in Ontario. Additionally, the agreement includes C$215 million for the assembly of a new generation of transmissions at a St. Catherines factory, with production expected to begin in late 2029.
At a broader scale, the C$1.1 billion investment represents a financial commitment to the Canadian auto sector during a period of high international trade tension. The U.S. tariffs currently add 25% to the cost of vehicles imported from Canada, a figure set to increase to 50% in 2027. Canadian negotiators have maintained that the survival of the domestic assembly and parts industry is a requirement for any new trade agreement with the U.S.
The deal highlights how major manufacturers might navigate suspended U.S.-Canada trade talks, which ended recently over disagreements regarding medium- and heavy-duty vehicles. U.S. Commerce Secretary Howard Lutnick stated that Canadian demands to include these specific vehicle types were only raised shortly before a deadline. What happens next depends on the results of the union vote concluding Sunday; if ratified, the investment timeline will extend through the end of the decade, while the 50% tariff increase remains scheduled for January 1, 2027.