GM is behaving exactly how they should behave – sort of

Increasingly our Ipsos clients have been asking us “how to plan better for the future?” I suspect it’s a common question of all consultants in today’s disruptive economic and social environment.

In that light, General Motor’s recent announcement to close its Oshawa facilities and to focus on building electric and autonomous vehicles elsewhere should not have surprised anyone who has been looking forward and watching the major trends unfold.

Carbon pricing (or a carbon tax, if that is the language you prefer), even the threat of a carbon pricing scheme is designed to change behavior.  The goal is quite simply to get people to modify their behaviours so that they create less carbon.  One of the many ways to do this is the move to electric vehicles and guess what? GM’s decision to focus on electric vehicles is proof that carbon pricing is working.

COMMENTARY: Climate change is a Canadian dilemma

It’s absurd to think we will change human behaviour and it won’t have an impact on companies that serve and sell to these people.  On this front, GM is prudently changing its own corporate behavior and making the shift to electric so that they can supply the exact product that carbon pricing is encouraging people to buy.  This is exactly what carbon pricing is designed to do.

COMMENTARY: Stein’s Law is cold comfort to devastated GM workers

Advancements in autonomous vehicles are happening fast.  Some of the best advancements in this space are happening in Canada and many Canadians are if not supportive, at least telling us that they will accept these driverless cars.  As I wrote for Global News last October there are some barriers to autonomous vehicles, however, more than half (55 per cent) of Canadians say that in the future, we will see more driverless cars than cars with drivers on the roads (only 21 per cent disagree). A similar number (54 per cent) say that it is likely that at least 10 per cent of all cars will be driverless within the next decade. Any smart company like GM, looking ahead would see this today and start now to position themselves for the future.

The decision on where to make the shift from gas-powered cars with steering wheels to electric and autonomous vehicles is multi-faceted.   The choice of Canada, the US or elsewhere involves a complex mix of considerations including but not limited to taxes, tariffs, labour market costs, availability of workers with the new skills required, etc.  How individual jurisdiction stack up in GM’s decision matrix will only be known by GM.

If General Motors was not acting today, you can bet that in five to 10 years when they required a bailout, the criticism would all be leveled around why they didn’t act sooner when they saw the shift to electric and autonomous coming.

Scheer says bailout not the best option in GM closure

1:56 Scheer says bailout not the best option in GM closure

I am sure (at least I hope) that all the key players (Unifor and all three levels of government) have been considering the long-term impact of social and technological disruption on the automotive and other industries and planning for a disruption just like this one.  My guess is they are really only surprised that GM didn’t provide more notice to them of the closure before going public.

How GM closure could affect the industry

1:07 General Motors: How the Oshawa closure will impact jobs

On that front, the issue of transparency, openness and the need to communicate, GM may well have some concerns.  But that will have to wait until I have time to write another piece about how those attributes contribute to how much we trust a corporation and how important building and maintaining that trust will be to GM’s long-term success no matter what vehicles they make or where they make them.

Mike Colledge is president, Canada Ipsos Public Affairs.