Chrysler Group and the Canadian Auto Workers reportedly had constructive talks on a new contract on Friday, according to the head of the union, but remained apart with the automaker complaining the union’s pattern deal was too expensive.
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Fiat SpA’s Chrysler is the only Detroit Three automaker without a labour contract in Canada after union members ratified a deal with Ford last week and agreed a four-year tentative pact with General Motors, Reuters reported.
“[Friday] we have had constructive discussions with Chrysler… We are obviously apart in terms of their initial position relative to the pattern,” CAW national president Ken Lewenza said.
“Chrysler is still saying the pattern is a little bit expensive, we have to have some discussions about whether we can tweak it or not tweak it. Maybe we can do some things creative,” Lewenza said in an interview.
“For example, they look at the C$3,000 signing bonus and say ‘Jeez that’s a big chunk for us to absorb all at once, and can I be flexible?’,” he said.
The union, which represents about 20,000 workers at the Detroit Three, has asked Chrysler for a written proposal in response to the Ford deal.
Lewenza said on Friday he was hopeful of getting a deal “early next week”. Earlier CAW secretary-treasurer Peter Kennedy said he would be “very happy if we can wrap this thing up on Monday”.
Of the three automakers, Chrysler and its chief executive, Sergio Marchionne, have taken the hardest line on labour costs in Canada, insisting that they must come down to match those of the United Auto Workers in the United States.
The Detroit Three say Canada is the most expensive place in the world to assemble vehicles. Marchionne has threatened to move production out of Canada if labor costs don’t come down.
Even so, Chrysler will ultimately have to accept the pattern agreement or face a costly strike that would halt the production of some of the automaker’s key products, Tony Faria, a University of Windsor professor and auto industry expert, told Reuters.
“If Sergio Marchionne were to push Chrysler into a strike in Canada all that would happen is that he would lose whatever number of days of production and ultimately end up agreeing to the same deal anyhow,” Faria said.
“It is up to him from there what he is going to do, if he is going to follow through on looking at possibly moving some activities out of Canada into the US or Mexico. But he is going to have to make the decision as he is definitely going to have this contract,” he said.
“Tweaking and meeting the pattern are two different things. I don’t want to close the door to (Chrysler’s) suggestions but they know how important the pattern is to us,” Lewenza said.
