The CGE Branch Plant Economy
From the late 1800s to the end of WWII, Canada imposed protective tariffs on U.S. goods under the National Policy in order to “shield Canadian manufacturers from American competition” (Mcintosh, 2015). While intended to uplift the Canadian industry, these policies had mixed success. Some argue that they inadvertently led to increased U.S. investment in Canadian markets, as American companies established branch plants in Canada to circumvent these tariffs, often outcompeting local manufacturers (Clarkson 1977). Following WWII, investment in branch plants accelerated, particularly as Canada’s economy rebounded and the discovery of Alberta’s oil fields posed Canada as an attractive area of American investment and business expansion (McIntosh 2015). Given this economic model, it is highly likely that CGE itself was established as a branch plant, benefitting both American and Canadian industries and consumers by allowing General Electric to expand into Canadian markets without facing high import tariffs.
The branch plant economy model may also explain why multiple versions of the same record player existed under different model names and distributors. In Canada, identical record players were sold through retailers such as Canadian Tire, Sears, and Consumers Distributing, yet they were marketed under slightly different names, materials, descriptions, and branding. For instance, a Canadian Tire catalogue listed the record player as being made of polystyrene, while Sears advertised it as polyurethane, and several others labeled it as polyethylene. This suggests that while the original design may have belonged to General Electric, the model was likely licensed or adapted by other Canadian manufacturers and retailers. As McIntosh (2015) notes, "In a relatively small number of cases, foreign firms licensed Canadian companies to use technologies that they had developed, so that goods and services based on these new technologies were produced in Canadian-owned establishments."
