OAKVILLE, Ontario -- Ford Motor Co. will spend $820 million ($1 billion Canadian) to turn its Oakville, Ontario, plant into a flexible manufacturing operation, the car maker said on Friday.
The project would transform the Oakville facility, which makes the Ford Freestar and Mercury Monterey minivans, into a flexible assembly plant that could make multiple models on the same assembly line.
The updated plant -- on track to be Ford's seventh flexible facility -- would begin production in 2006. Product details will be announced later.
"Flexible manufacturing enables the plant to change the mix, volume and options of products in response to consumer demand, representing a new level of market agility," said Anne Stevens, group vice-president for Canada, Mexico and South America at Ford Motor Co.
Work on the new assembly complex is expected to begin next month. The facility will also be home to a research and development center focusing on fuel cell technology, Ford said.
The announcement won praise from Ontario Premier Dalton McGuinty, who said Ford had given the province and its workers a "resounding vote of confidence."
The provincial government is negotiating an agreement with Ford for $82 millin ($100 million Canadian) through its Ontario Automotive Investment Strategy to support the assembly and R&D complex.
The federal government is also making an $82 million ($100 million Canadian) contribution to the redevelopment of the Oakville plant.
The money is part of Ottawa's larger commitment to the Canadian automotive industry, which is the country's largest manufacturing sector and a key driver of the economy.
The federal contribution, which is conditionally repayable, will support areas of the project related to innovative technologies, environmental research and advanced engineering.