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Retooling to car manufacturing plant would be faster

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Retooling to car manufacturing plant would be faster and cheaper than building a new plant in Canada 2. They didn’t have to invest capital (b/c it was hard to get loans banks b/c they saw this new auto industry was risky) US automaker relies heavily on outsourcing parts, Government placed a lower tariffs on parts to promote Canadian parts industry(Such strategy 1. encouraged the retooling of Canadian assembly plants from producing buggies to car by offering some cost advantages 2. Also encouraged domestic sourcing of parts) Initially the Buick and ford plant was only assembly sites that put together US made parts but overtime parts and materials were increasingly sourced in Canada, including iron, steel, brass and bronze, jute, tubes and piping lead, glass, lumber, and fabric
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In order to achieve the fundamental strategy of mass production low-cost vehicle that was affordable to the masses, McGregor 1. reduced cost by sourcing parts made in Canada to capture full value and avoid the tariffs 2.limited the number of models offered to achieve high volume for parts and materials to obtain volume discount and reduced transaction costs The main reason why the Canadian auto industry was successful was b/c the tariff wall , scarce capital , demand for auto mobiles outpaced supply Imperial preference British Imperial preference in (1897) through PM Laurier which was abolished in 1846 of reform of British economy Given Canada an advantage : membership in vast international network of colonies and dominions Under British preference system Canada could export to nations that were part of British empire like India, Australia with favorable tariff treatment over US manufacturers Imperial preference offered a special advantage to the Canadian auto industry b/c U.S companies used their Canadian units to export cheaper products to imperial nations around the world Export sales allowed for a smoother production and employment schedule for Canadian plants B/C of Imperial Preference Ford Motor given Ford Canada exclusive right to manufacture and sell ford products throughout the empire except UK and sat up local subsidiaries at colonies and dominion in responding demand(managed exclusively by Canadians and operated free of influence from Detroit) Reciprocal Revised In 1854 Canada had a limited free trade agreement with U.S referred to as reciprocity 1911 Laurier attempted to restore the reciprocity with US, however, the Canadian industries didn’t support it, Liberal party and free trade notion was not adopted The sale of the McLaughlin motor car company to general motors With Ford’s competition McLaughlin disposed the carriage business and soon shifted to production of motor vehicles exclusively With Concern that the license with Buick could not be renewed , Sam McLaughlin and his father agreed to sell the company to general motors for $5M and McLaughlin remained in charge as president of the new company the new company is named General Motors of
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Retooling to car manufacturing plant would be faster and...

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