CAW defiant in face of Chrysler's demands
The CAW's president says his union will not abandon pattern bargaining despite a threat by Chrysler Canada to shut down operations in this country if it doesn't get big concessions on labour costs.
12/03/2009 2:00:32 PM
CAW defiant in face of Chrysler's demands
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Canadian Auto Workers President Ken Lewenza speaks during a press conference in Toronto, Thursday, March 5, 2009.
CTV.ca News Staff
"There's going to be absolutely no walking away from the pattern bargained," Ken Lewenza told The Canadian Press in an interview Thursday.
"If they out-and-out say, 'Sorry Ken, we're not going to meet the pattern,' then we're not going to get an agreement in Canada."
On Wednesday, General Motors reached an agreement with CAW that included major concessions by the union, in hopes of getting federal bailout funds.
CAW members voted 87 per cent in favour of the cost-cutting contract that includes a wage freeze to September 2012, the elimination of an annual bonus and a reduction in paid time off, among other concessions.
The CAW has generally used its first deal with a Big Three automaker to set a pattern for agreements with the other two.
"They sent me the message (Wednesday) afternoon that they didn't think the General Motors pattern agreement met the needs of Chrysler, but that was the same message that they've sent our bargaining committee at Chrysler over and over and over following a patterned settlement," Lewenza said. "They do that during good times."
At a Wednesday evening parliamentary committee meeting, Chrysler LLC painted a grim picture of its situation in Canada, saying it needs billion of dollars in help if it is to survive.
Chrysler President and Vice-Chairman Tom LaSorda told MPs the company is seeking US$2.3 billion from the Canadian government, plus a break on a fight over taxes and major sacrifices from the Canadian Auto Workers.
LaSorda said Chrysler is willing to pull out of Canada, where it employs 10,000 hourly workers, if it makes financial sense to do so.
"Chrysler LLC cannot afford to manufacture products in a jurisdiction that in uncompetitive relative to other automotive jurisdictions," he said on Wednesday.
LaSorda said his company's labour costs are $70 an hour in wages and benefits for both current workers and retirees. He says it needs to be cut by $20 per hour to be competitive.
Ontario's economic development minister tried to pass off Chrysler's threat to leave Canada if its demands aren't met as simply a worst-case scenario being presented as part of a bargaining process.
"I know Tom LaSorda, he's a great Canadian and he's not somebody who wants to be known as they guy who shut down Chrysler," Michael Bryant told reporters in Toronto on Thursday.
"It was a ham-fisted way of expressing the reality that, in the absence of an agreement, Chrysler's going to face critical challenges."
Clement's view
"I think he's more or less stating the obvious in a bit of apocalyptic terms, but in accurate terms too," Industry Minister Tony Clement said Thursday about LaSorda's remarks.
He told Canada AM the Canadian auto industry is in the midst of an "existential crisis" and government, unions and management must work together or the sector will lose its ability to compete.
Clement said the government wants to help Chrysler, but needs assurance that the investment is safe -- a sentiment echoed by Bryant. He said all players need to work together to make the industry competitive.
"The fact of the matter is unless government of course, but also labour and management come together to severely restructure the auto industry both in Canada and the U.S., we're into a place where they cannot compete and they cannot succeed," Clement said.
Chrysler LLC is taking some of the right steps, Clement said, such as looking for international partnerships as a means of remaining in business.
He also said the money from Ottawa would be a loan that the government would expect to be repaid. It would also be vital that the company continues to produce vehicles in Canada at current levels.
"We want to get this money back out of the auto sector over a period of time," Clement said.
"These are repayable loans. We want to make sure Canada maintains its 20 per cent of production that we have right now in the North American auto sector, so these are the kinds of things wee reviewing in both the case of Chrysler and GM."
He said there will be a flurry of discussions and negotiations over the next few weeks as the government decides "is it going to be money well spent and not money down the drain."
Chrysler Canada and its parent company, Chrysler LLC, have had their sales hammered by the economic downturn.
Its sales were down 27 per cent in February compared to last year and it has asked Ottawa for a $1 billion in emergency loans as it works on its restructuring plan.
Just last week, Chrysler announced it would be cutting 1,200 jobs in Windsor, Ont., by eliminating the third shift at its minivan assembly plant.
The Windsor plant produces the Chrysler Town & Country and Dodge Grand Caravan minivans and has about 4,450 hourly workers. It is the company's only supplier on minivans as two other minivan plants have been shut down in the U.S.
LaSorda said the company could move the Windsor plant to either of the other sites they previously shut down.
However, Lewenza said the company's assembly plants in Windsor and Brampton are state-of-the-art facilities.
"It wouldn't make any business sense, because both the Brampton and Windsor assembly plants are very productive plants, they're very profitable plants, the workforce is the highest of quality and the best of productivity," he said.
Shutting down those plants would harm Chrysler's ability to cut costs and turn around its operations, Lewenza said.
With files from The Canadian Press
