CAW says Ford wants same general concessions as union gave GM and Chrysler

Published Tuesday July 7th, 2009

TORONTO - Ford has asked the Canadian Auto Workers to match recent concession-filled labour deals with the other members of the Detroit Three so it can remain competitive, according to the union.

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THE ASSOCIATED PRESS/David Zalubowski

Mike Vince, chairman of the CAW's Ford master bargaining committee and president of Local 200 in Windsor, Ont., said Ford Canada pleaded its case to the union Monday night.

Although the CAW's current contract with Ford doesn't expire until 2011, Ford says new labour agreements with GM and Chrysler as well as with Ford's U.S. workers have put it at a competitive disadvantage.

"We do recognize that we must stay competitive with our (U.S.) counterparts and with the Canadian GM and Chrysler counterparts," Vince said Tuesday.

CAW economist Jim Stanford, who was also at the meeting with Ford executives, said the company is looking for a labour agreement very similar to that reached with the other automakers.

"In terms of what we call the master contract which covers the bigger economic issues, I think they are looking for the same agreement that we have with GM and Chrysler," Stanford said. "They'll be looking to use that cookie-cutter approach."

CAW president Ken Lewenza said Ford must agree to maintain its current Canadian production footprint if the union is to give the company concessions.

"There's no question they're at a disadvantage. The question for us is what advantage is it for us to open (negotiations), and the only advantage would be to secure our manufacturing footprint," Lewenza said.

However, Ford has no plans to manufacture vehicles at its 1,600-employee St. Thomas, Ont., plant beyond 2011 and it's likely the plant will shut down once the vehicles it currently manufactures - the Ford Crown Victoria, the Mercury Grand Marquis and the Lincoln Town Car - are taken off the line.

"Without a replacement product the closure is inevitable. At least it gives us some time to lobby for another product, but it's going to be an uphill battle," Lewenza said.

Ford was the only one of the so-called Detroit Three carmakers not to get any financial aid from the U.S. or Canadian governments to stay alive and restructure under U.S. court bankruptcy protection. As a condition of billions of dollars in government aid, GM and Chrysler were forced to negotiate new deals with their unions in Canada and the U.S.

After months of bargaining during which the CAW reached agreements with GM, then Chrysler, and was then forced by the federal and Ontario governments to give GM even more concessions, the union agreed to slash labour costs at both companies by cutting benefits, changing pension funding obligations and creating a trust for retirees' health benefits.

In addition, Ford Canada's Detroit-based parent (NYSE:F) won US$500 million in savings under a new contract with the United Auto Workers in March. Reports say Ford has asked the UAW to match concessions made to Chrysler and GM as well, although the union refused to confirm or deny this on Tuesday.

Although Ford increased its Canadian sales by 24.6 per cent in June compared to a year earlier, gaining the industry's top spot for the first time in decades, the company has said the new labour contracts have left Ford unable to compete.

"To be able to maintain an auto manufacturing presence in Canada, we have to take action now to improve our competitiveness; we cannot wait until 2011 (when the current contract expires) since it may be too late to close the labour cost gap," Ford Canada spokeswoman Lauren More said in an email.

Vince said CAW leadership will review Ford's submission and will decide whether to reopen negotiations within "a week or so."

"We do recognize that many families are relying on us to make the right decision," he said.

"We've got to make sure that our members aren't at a disadvantage moving forward and that we have a Canadian footprint at the end of the day."

Ford Canada employs about 7,000 people at assembly plants in Oakville, Ont., and St. Thomas and a parts plant in Windsor.

 

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