The Canadian Auto Workers union has said it held constructive talks with senior negotiators at General Motors and was awaiting a response from Chrysler on the framework deal it forged on Monday.
The two automakers were crunching numbers in a tentative agreement the union reached with Ford on Monday, Reuters reported.
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“We had a very constructive discussion with the leadership of the GM team … and I’m feeling pretty good about the end result,” CAW national president Ken Lewenza told the news agency. “I can’t say that about Chrysler today (18 September) because I haven’t talked to Al Iacobelli directly.”
Iacobelli, Chrysler’s vice president of employee relations, and Cathy Clegg, GM vice president of labour relations, have joined negotiations at a downtown Toronto hotel, along with other senior management teams, Lewenza said.
The union and GM discussed the framework agreement in detail and Lewenza said he was now waiting for a formal proposal from the company.
While Lewenza said he was optimistic about reaching a deal with GM, he could not predict the timing.
“Being optimistic and seeing it on paper is another thing,” he said.
The CAW has said it would keep negotiating with GM and Chrysler as long as progress seemed to be in sight. If talks become deadlocked, however, the union was still threatening to call its first Canadian auto strike since 1996.
Despite a strike threat by the union, experts told Reuters it was unlikely that GM or Chrysler would risk a strike.
“The savings, in the difference between what they want and what’s out there, may not be sufficient to warrant a strike, especially in the case of Chrysler,” Art Schwartz, a labour consultant and former GM labour negotiator based in Ann Arbor, Michigan, told the news agency.
“The CAW is going to stick to its guns on a pattern agreement. He (Lewenza) expects them to accept this contract with only, at the most, maybe a couple of minor tweaks at the very edges of it,” Schwartz added, pointing out that the industry’s options were limited in the short run.
“Both parties can always threaten to move out of Canada in the long run. Short term they can’t do anything.”
According to Reutersm Sergio Marchionne, CEO of Chrysler and its parent Fiat, has threatened to do just that, saying the company has “other plants, other options”. Moving operations is a complex, time-consuming and expensive matter.
“If he asked my advice I would tell him to accept the deal. There is no point in going on strike because ultimately they are going to be stuck with this deal anyhow,” Tony Faria, a University of Windsor professor and auto industry expert, told Reuters.
About 26% of Chrysler’s North American production comes from Canada, compared with 21% at GM and 9% at Ford, UBS said in a report.
Production from Chrysler’s Windsor, Ontario, plant, the sole source of minivans in North America, and its Brampton, Ontario, plant, which assembles sedans, accounts for 15% to 20% of all Chrysler sales, Faria told Reuters.
“They can’t afford to have production of these products go down.”
