New Brunswick’s Boulevard of Broken Dreams

For those of you who don’t know my background, way back when in the early 1990s when I was fresh out of university, I got a short term job helping the NB Department of Economic Development write proposals for companies thinking about setting up in New Brunswick. These proposals were essentially the business case for investing in New Brunswick. During a four year stint, I must have written over a hundred of these things.

A few of these proposals I remember with great clarity. UPS and their 900 jobs. The VP of UPS Canada told me that he ‘slept with my proposal under his pillow’. Then there was the Royal Bank and its 500 jobs. Xerox, Air Canada, IBM, etc. etc. etc.

But the one I remember most of all was a proposal that I wrote for a project we never won.

Mercedes-Benz.

You see, in the early 1990s, the German automakers started to look closely at North America as a site for manufacturing. New Brunswick’s gal in Germany got wind of Mercedes-Benz’s plans and I was tasked with making the case for that company to put 1,500 high paying manufacturing jobs in New Brunswick.

I poured my heart and soul into that proposal. Cost benefits. Low turnover. Loyal workers. The Port of Halifax. The Canadian dollar. 50+ pages outlining the clear benefits of locating in New Brunswick.

The proposal was submitted – most likely along with hundreds of others and in the end the company chose Alabama.

I was devastated. This project could have signalled the beginning of an auto cluster in Atlantic Canada. This project could have been the harbinger of great things to come.

Why Alabama? We were cheaper (because of the CDN $$ and low power rates). We had a better educated workforce (the company had to give remedial literacy training to its Alabama workers because many could not read the interoffice memos). We were as close to the major markets as Alabama. We had lots of low cost land.

In the end, it was most likely the $200 million incentive package that tipped the scales. Some credited the ‘Right to Work’ status of Alabama but I don’t believe it.

Would have, could have, should have. If we had attracted that plant, there would most likely be thousands of high paying manufacturing and related jobs here that aren’t here now (18 firms set up in Alabama to service Mercedes).

Is it possible that Mercedes would have ever chosen New Brunswick? I’ll tell you this, in 1992, Alabama was as unlikely a choice. Now, Alabama is home to several auto production plants and dozens of support companies.

How dare they spend $200 million in corporate welfare?

We have spent over $7 billion in EI payments to New Brunswick workers since that plant first opened.

The other thing that falls into the ‘If I only knew then what I know now’ category is around the sales effort. What if PM Cretien had gotten on a plane with Frank McKenna and went to Germany to hand deliver the proposal? What if Buzz Hargrove himself was part of the sales pitch? What if, what if.

What made me recall this tipping point that was never to be?

This story (BMW came slightly after Mercedes):

BMW produces one-millionth vehicle in South Carolina
Associated Press

BMW Manufacturing Co. has produced its one-millionth vehicle in South Carolina.

The blue Z4 M Roadster, which came off the line Tuesday, will be on display at the Upstate factory for several weeks before moving next door to the Zentrum museum.

On Friday, the company celebrated how far the plant has come since producing its first vehicle in 1994. It has grown from 600 employees to 4,500 employees.

Tisk. Tisk. Tisk.

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0 Responses to New Brunswick’s Boulevard of Broken Dreams

  1. Anonymous says:

    Wow, the romantics are all over the place! That IS one of the saddest stories I’ve heard. Did McKenna actually go to Germany? Have you ever thought of digging up the proposal again, pretty much all the economic advantages still apply. Hell, get Shawn Graham on the phone.

    What if a package were put together for constructing their ‘smart cars’. The reasons are quite plentiful, first of all, they sell like mad in Canada, but are not readily available in the states. Again, all the previous ‘benefits’ still stand. If 250 million can go to a dying forestry industry, why not for bringing a new industry? What if WE researched on where to put it, how to supply it, what companies can transport it.

    I honestly think this bone would/could/should go to Miramichi. Fix up that highway going to the TCH and bobs your uncle. However, Saint John and the south probably even have older workers who actually worked auto with Bricklyn.

    In fact, if you’ve got that proposal a meeting with Lord should be set up. Clearly here’s a guy who NEEDS something like this to turn things around.

    I know that they are having financial troubles with the smart car. Hell, you could advertise in a local paper with a link to their website and people would start training themselves with the schematics. Wages are obviously much higher in Europe, but here would be far cheaper and no shipping. Surely local suppliers (at least from Ontario) could be found instead of shipping the parts.

    That’s how Maine’s economy is kept going, all the suppliers to the naval construction yard on the coast.

    Hell, let’s do up a DVD on our own and send it over there. I have no doubt that if you got their interest and told the government (and showed them) what was being done then they aren’t exactly going to not take their call. Hell, we could get a petition going demanding that Lord spend double what he gave a dying forestry sector. Surely 500 million would go a long way! As people SHOULD know, the feds only get involved in projects other people start. So how about it, how about at least posting the proposal so some of US can do something with it. Being a romantic is all well and good, but yearning for the past doesn’t help NOW.

    Do that and I”LL start a fundraiser to send YOU to Germany.

  2. Anonymous says:

    As for ‘right to work’, that’s not a problem and I doubt it was a problem there. The NDP are utterly despised in NB. Thanks to the Irving press unions are held in pretty low regard. This is the LEAST likely place to find a union. Heck, if toyota can run its plants without unions, I’m sure these guys can in new brunswick quite easily.

  3. David Campbell says:

    I absolutely appreciate your eagerness but I’ll respond to a few of your points:

    1. I don’t even have a copy of that proposal – it is probably long gone and buried. Besides the graphics I used back then were laughable (I had to recreate the Mercedes logo to put on the front – remember no Internet then). But I have no doubt that somebody in BNB could put together a kick-arse proposal.

    2. I am not sure that Ontario would ‘let’ the feds invest in an auto plant in New Brunswick – even Smart Cars. That would take chutzpa that I haven’t seen in 15 years.

    3. You are right about the Miramichi. Most of the large auto plants in the U.S. are located in either smaller communities or well outside (45-60 miles) the large urban centres. When you need 1,000 acres that tends to be the case. A major employer like that would anchor the Miramichi’s development for a generation.

    4. I am not sure a ‘grass roots’ effort would work here. I think these large deals are done at the highest levels. A Lord/Harper/maybe even McKenna pitch to whomever (with competitive incentives in tow) might work.

    I am happy to share my thoughts on these issues but ultimately, I’m just a guy squatting in a little corner of cyberspace writing random thoughts. If the New Brunswick government wants to get into the big leagues and take the issue of economic development for future generations seriously, I will do what I can but at the end of the day the will has to be there politicians and public.

  4. Anonymous says:

    Horseshit. That’s quitter talk and why New Brunswickers are at the bottom of the food chain. People can WAIT a generation or more for a Mckenna. HEre’s why it NEEDS grassroots impetus.

    First, politicians are gutless cowards. We KNOW what New Brunswicks ‘highest levels’ are doing. Lord is busy campaigning for Harper and handing out New Brunswickers money and land to giant corporations in exchange for fewer jobs. Call me stupid but I don’t go to the guy who shot me for first aid.

    There is no doubt at some point obviously the province needs to be involved. That’s why I’d submit a two prong approach, first, the selling campaign to Smart Car. And second, the domestic campaign to supply the money. I personally don’t see how it can’t be supported. 500 million can be tax credits, or all kinds of incentives. New Brunswick is already out that amount to the LNG terminal, all for a grand total of EIGHT jobs.

    As mentioned, forestry is dead or dying, yet warrants half that to put all the natives and small woodlot owners out of work.

    Sitting on our arses griping only accomplishes so much , and what that is is pretty tenuous. There are all kinds of fights in the world people don’t think they can win-until they try. It was one woman in Seattle who singlehandedly got Starbucks to sell fair trade organic coffee. It’s true that canadians lack even that one woman (after all, Tim’s still doesn’t bother).

    Screw chutzpa. ONTARIO can’t dictate anything. Particularly with tories in power. With the auto pact gone there’s nothing they can do about it. There is the obvious question that we don’t know how the new feds feel about corporate welfare, in the past Harper was quite against it but seems to have softened.

    However, in the province we can easily provide free land. We can easily provide the power hookup and even a power subsidy (though that one is tougher, but it can still be done).

    It’s clear that most governments don’t want to do anything because it might offend voters. These numbskulls in power didn’t even call RIM because of all the bonehead reasons we’ve previously discussed.

    I know you weren’t there, but we worked our asses off (some more than others) and we got them to introduce tenants rights legislation that SHOULD have been there in the seventies when everybody else had it. This came from NO media coverage from Irvings, albeit with the fortunate occurence of a byelection.

    BUt when it comes to JOBS, then New Brunswickers take notice. You are quite right about the ‘will’ being there. But politicians don’t have the will on their own, they never have, never will. Unless its their own career. But when PEOPLE express their will, government has no choice but listen. WHy do you think Irving spends so much effort to control the media and fill it with propaganda?

    OK, this has me energized. I’ve unfortunately got ADD, but I’m gointg to get the ball rolling. Hey, anybody have Donald Savoie’s email?”)

  5. Anonymous says:

    Ohmygod!! Do you want another reason why this HAS to be grassroots. I can’t f$#$%&ing believe this!

    http://www.gnb.ca/0398/share/Business_Climate/index-e.asp

    Have you BEEN to ‘business new brunswick’?? Oh lord, I can’t hardly sit down this has me so…I dont even know how to describe it. THESE PEOPLE ARE RETARDED!! There are now two choices New Brunswickers have, either these people are the stupidest people in existence, or, as I am more likely to believe, Irving is simply running the government for their own convenience.

    After all, why would Irving want more businesses here? Of course they don’t! Just GO to the website, that’s all I can say …for now.

  6. Anonymous says:

    Just a clue, this is at their homepage: because of the ALL TIME LOW PRICE OF THE DOLLAR. THat’ right, they’re touting the all time low dollar. Now, call me crazy but there hasn’t been an all time low dollar for almost a decade. THey haven’t even updated their website! And that doesn’t even include the poor design of their homepage. If I were a multinational corporation it would be hard enough to find the right link. Not only that but they use software that most computers don’t even have to access their infomrmation. Think what you want, if yo think the government is going to do something, you’ ve got a long wait ahead of you.

  7. scott says:

    Don’t worry David, you’re still very young! You’ll have another opportunity to redeem yourself.