The problems in Ontario's auto industry have taken a turn for the worse as Progressive Moulded Products Ltd., announces it has ceased operations at the plants in Concord and Rexdale.
The shut down of 11 small plants that were operated by Progressive Moulded Products Ltd will put another 2,000 jobs out of work in the already troubled auto industry.
"As a result of a number of major customers electing to move their business elsewhere, we are undertaking immediate and drastic reduction in our operations and workforce," said company official Michael Daniher.
Two weeks ago, the company
filed for court protection and was in ongoing discussions with major customers and lenders to find solutions to its financial problems, however, those talks have failed.
"The vast majority of the company's employees have been terminated in recent days," he said. "There are still hundreds of employees on the job working to complete a number of other existing production assignments."
The blamed for the company's failure is being placed on a heavy debt load, declining vehicle sales, the increasing cost of commodities and currency fluctuations in North America.
In addition, the decision by General Motors to close a truck manufacturing plant in Oshawa, Ont., had an impact.
"Certainly unfolding circumstances in the auto industry played a significant factor in bringing the company to the unfortunate position of recent days," he said.
Progressive operates 11 facilities in the Toronto area and three plants in the United States and two of the American facilities were also closed, with the elimination of 300 jobs.
Progressive designs and manufacturers interior plastic systems for vehicles, mostly making integrated consoles and instrument panels for cars.
Rapidly rising fuel costs and a corresponding drop in demand for gas-guzzling vehicles are wrecking havoc on southern Ontario's auto manufacturing sector,
In June, GM announced that the truck assembly plant in Oshawa would be among four North American plants being closed in the next few years; this put 2,600 people out of work.
Also in June, Magna International Inc., which is Canada's largest auto parts manufacturer, announced it would be cutting 400 jobs at its plant in St. Thomas, Ont., due to flagging truck sales.
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