Ford is getting ready to build more V8 engines, but not in America

Ford and the Unifor labor union representing 5,000 Canadian auto workers have ratified a new three-year labor agreement, and employees will get 9% wage bumps as well as increased pension benefits and ratification bonuses of $7,090 for eligible full-time permanent employees and $1,419 for temporary workers.

At Ford's lone vehicle assembly plant in Oakville, Ontario, the original plan to build battery-electric vehicles was scrapped in 2024, about the same time the final Ford Edge rolled off the assembly line. Since then, the automaker has been retooling the plant for Super Duty pickup truck assembly, which is slated to begin later this year. In addition to Oakville (pictured below), Ford will also continue building Super Duty trucks in Avon Lake, Ohio, and at Kentucky Truck. But there's more happening north of the border than just vehicles.

While labor talks have a history of being combative, they also provide a glimpse into the future for an automaker agreeing to the new terms. In the case of Ford's new deal with Unifor, beyond Super Duty assembly, engines feature prominently in the contract, specifically at the Windsor and Essex engine plants across the river from Detroit. A third shift is forecast for the Essex plant in 2029, suggesting Ford sees continued demand for V8s.

Any Chance Romeo Engine Plant Reopens?

The Essex plant produces Ford's 5.0-liter Coyote V8, while Windsor builds 6.8-liter Triton V10 and 7.3-liter Super Duty V8s. Since Ford closed its Romeo, Michigan, engine plant in December 2022, the Essex plant is vital as the only source for Coyote V8s for Ford F-150 pickups, Mustang GT, and Mustang Dark Horse, while the supercharged 5.2-liter V8 in the Mustang GTD and F-150 Raptor R comes from the Dearborn, Michigan, engine plant.

While the Unifor contract is good news for Canadian workers, analyst Sam Fiorani told CarBuzz via email that it's possible that Ford could reactivate the Romeo plant "if tariffs or other trade issues materially changed the business case," but he also said that seems unlikely.

Ford has spent years simplifying its powertrain manufacturing, and reversing that strategy would require a compelling economic justification, said Fiorani, vice president of global vehicle forecasting at AutoForecast Solutions.

Does the potential addition of a third shift at the Essex plant in 2029 suggest that Ford is not expecting to see much recovery in EV sales by then? Instead of signaling weak EV demand, Fiorani said that adding a third shift could reflect a change in Ford's powertrain strategy.

Hybrids As A Diesel Alternative?

"One possibility is greater reliance on gasoline-powered or plug-in hybrid trucks," Fiorani told CarBuzz. "A plug-in hybrid Super Duty, for example, could pair a gasoline V8 with high-torque electric motors to deliver the towing capability customers expect while reducing emissions and avoiding the growing cost and complexity of modern diesel emissions systems." That could become an attractive alternative to large-displacement diesel engines.

Fiorani said a similar strategy could eventually play out for the F-150. "Rather than viewing battery-electric and internal-combustion as mutually exclusive, Ford could choose to emphasize high-performance hybrid or plug-in hybrid trucks that bridge the gap between conventional gasoline models and full EVs," Fiorani said. The question is whether those hybrids would use V8s from Canada or perhaps V6s from Lima, Ohio.

Super Duty Flexibility In Oakville

Expanding V8 production in Canada could also have implications elsewhere in Ford's manufacturing network, Fiorani said. "If gasoline engines replace some diesel applications, production at (Ford's) Chihuahua Engine Plant in Mexico could eventually be reduced or reallocated," he said.

On the truck front, adding Oakville as a Super Duty assembly point likely means redistributing production of certain models currently produced at Super Duty plants in Ohio and Kentucky. "Oakville gives the company additional flexibility to balance production across its truck plants," Fiorani said.

CarBuzz Insight – Why This Matters:

Tariffs, emissions regulations, cross-border feuding among politicians, and whether the new Gordie Howe International Bridge opens on Monday to traffic between Detroit and Windsor – they all have an impact on the Canadian auto industry, which has taken its lumps as vehicle production is down 33% from pre-pandemic levels.

So Ford workers in Oakville, Essex, and Windsor have cause to celebrate, relieved that their jobs appear to be safe at least until 2029, when the new contract expires. Now the Unifor union turns its attention to General Motors, with contract talks set to begin on August 10. The union represents more than 4,600 members at Ontario facilities in Oshawa, Ingersoll, St. Catharines, and Woodstock.