From 40 years ago: The push to land a new Ford plant

The news that Ford would build a plant in Ontario was welcome to many on this side of the border, but upset those who lost out in the U.S.

Deal left U.S. upset, but Ottawa and Queen's Park bickered and battled to make it happen

A worker is seen inside the Essex Engine Plant in 2003, a quarter century after government investment helped establish its presence. (Carlos Osorio/Associated Press)

Forty years ago, Ontario learned it would be home to a new Ford engine plant, after two levels of government provided millions of dollars to lure the automaker's investment north of the border.

But it wasn't an easy deal to bring to fruition, as the governments found it hard to agree on a game plan.

These clips from The National in June of 1978, explain the background on the Ford plant situation. 0:32

The chance to bring new, well-paying automotive jobs north of the border left the Canadian and Ontario governments eager to see the Ford plant sitting on Canadian soil.

'Ford knows it has the upper hand'

But the opportunity wouldn't come cheap: Ford initially sought $30 million, but would eventually end up seeking — and receiving — more than double that figure.

"In this time of high unemployment, Ford knows it has the upper hand," reporter Peter Murphy explained to viewers on The National, in June of 1978.

The automaker said the money was necessary to account for higher costs for going with the Canadian site, rather than expanding an existing one in Ohio.

Not 'at any cost'

Weeks before Ford made it official that it would go with Ontario, Ottawa and Queen's Park weren't in agreement on how much cash they would each put forward.

"We're not prepared to get into the bidding game at any cost," said prime minister Pierre Trudeau, when speaking about the situation at the end of June.

In June of 1978, Ottawa and the Ontario government openly disagreed on how much each side should pay to help lure a Ford plant to the province. 1:18

The federal government did not want to provide more than half the funds, according to the June 30, 1978 report from The National seen above. Yet Ontario's government only wanted to pay for one-third of these funds, at that point.

'$30 million on the table'

Ford's Essex Engine Plant, seen here in a 2006 file photo, ended up in Ontario after two levels of government provided incentives to the automaker. (Craig Glover/Canadian Press)

"I don't suppose this is the place to negotiate with Ford, but it's certainly a place to set the record straight on Ontario and Ottawa relations," Trudeau said. 

"We're the guys who put the $30 million on the table and have been trying to get Ford here for many months, at a time when the Ontario government was dragging its feet. Full stop."

The two governments were said to be continuing discussions on the matter, despite the daylight between them.

$68 million got it done

On Aug. 3, 1978, however, the public would learn that Ford's new $535-million plant would be built in Ontario. 

To get the result they were looking for, the two levels of government were providing $68 million — $40 million of which, came from Ottawa.

Industry Minister Jack Horner, seen here in a 1977 file photo along side Prime Minister Pierre Trudeau, said Ottawa was not "running around with a satchel full of money." (Chuck Mitchell/Canadian Press)

"I would not say we are running around with a satchel full of money, but we are trying to promote industry and development in all parts of Canada," said then-Industry Minister Jack Horner, after the deal was done.

Deal upset state-side neighbours

Because the plant was to be built in Ontario, that meant the investment from Ford wouldn't head south — and that upset Canada's biggest trading partner, who objected to the federal and provincial governments' actions.

Major government incentives encourage Ford to build a huge new plant in Ontario. 3:27

"For Canada, the Ford Motor victory already looks to be short-lived," the CBC's Jeff Carruthers reported, as heard in the radio report above. "The United States has already made it clear it doesn't like this sort of business going on, especially when it loses." 

Furthermore, U.S. officials formally registered their displeasure with the deal with Ottawa.

"The United States wanted to make the point that Canada now owes the U.S. something, that Canada will have to pay for the Ford victory, probably sooner rather than later," Carruthers said in his report.

'A blatant bribe'

Some U.S. legislators viewed the Ford arrangement as "a blatant bribe," according to a report that Russ Patrick filed for The National a few days after the deal was made public.

Some U.S. legislators saw the incentives offered to Ford as being "a blatant bribe." 0:47

In the fall of 1978, Trudeau would visit the land where the new plant would sit in Windsor, Ont.

As heard in the report below from October of 1978, Trudeau and government officials touted the fact the new plant would provide some 2,600 jobs when it became operational, along with "thousands" of additional spinoff jobs.

Pierre Trudeau visited the Windsor-area Ford plant for its inauguration in the fall of 1978. 0:30

The plant started operating in 1981. It still exists today — though Ford did shut it down briefly, as part of a restructuring at the company just over a decade ago.