The Canadian Auto Workers (CAW) is concentrating on negotiations with Ford as its lead company of the Detroit Three as it aims to agree a deal that will set the outlines for similar agreements with General Motors and Chrysler and avoid its first strike against a US-based automaker in 16 years.
According to Bloomberg News, a month of discussions aimed at securing a deal for about 18,000 CAW members has yet to produce agreement before the current contract expires at 11:59 p.m. local time on Monday (17 September). The talks come a year after the United Auto Workers (UAW) union south of the border agreed to give up base wage increases in a bid to lower labour costs.
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Ford in July called Canadian labour costs the most expensive it faces in the world, the news agency noted.
CAW president Ken Lewenza said at a Sunday press conference in Toronto: “If Ford has a desire to get a deal, our folks will get a deal.”
He said the union’s priority is bargaining with Ford. If the union reaches an accord, it will try to extend the basic terms to GM and Chrysler. The negotiations cover eight vehicle and engine plants in Ontario where output has declined due to a rising Canadian dollar and a shift in work to the US and Mexico.
For example, assembly of GM’s Chevrolet Impala, for decades a staple of the Oshawa car plant east of Toronto, is to move to a neighbouring flex plant and some output will be shared with a plant in Hamtramck, Michigan.
“Anything that holds back economic growth and employment is a serious concern,” Hosen Marjaee, a senior managing director at Manulife Asset Management in Toronto, told Bloomberg. “Ontario cannot afford to have more people unemployed or on strike and less revenue coming in.”
While carmakers seek to cut expenses, unions are refusing to go beyond concessions in the 2009 deal that were part of government-backed bankruptcies of GM (GM) and Chrysler. CAW leaders say that their members’ contribution to the companies’ turnarounds must be recognised. The province’s car industry has shrunk by about a third since 2000, eliminating about 50,000 jobs, according to CAW estimates.
Ford is “confident” that it and the CAW “can find innovative solutions to help build a successful future for our Canadian operations,” according to a company statement cited by Bloomberg.
Lewenza said some agreements in principle with the company have already been reached, but did not elaborate.
Chrysler is “very concerned by the CAW decision,” LouAnn Gosselin, a spokeswoman for Chrysler Canada, said in an e-mail to Bloomberg. Ford isn’t “in the best position to take on this role.” The e- mail cited Ford’s “significant reduction” in Canada – the automaker closed a vehicle assembly plant in Ontario last year.
GM was the last carmaker to be hit by a strike in Canada, in 1996. That walkout lasted 20 days, paralysing the company’s Canadian operations and forcing layoffs at other North American plants.
