CAW, Chrysler reach pattern deal without investment

The Canadian Auto Workers union Wednesday night announced a tentative deal with Chrysler.

Ford, GM already struck deals with the union, both included new investment

Ken Lewenza, the union's president, said the deal is similar to the ones struck with Ford and General Motors on Sept. 14 and 20, respectively. 1:10

The Canadian Auto Workers union Wednesday night announced a tentative deal with Chrysler.

Ken Lewenza, the union's president, said the deal is similar to the ones struck with Ford and General Motors on Sept. 14 and 20, respectively.

According to Lewenza, all three deals contain no base wage increases, but workers will get $2,000 a year in the second, third and fourth years to cover cost of living increases, and a $3,000 ratification bonus.

"We’re confident Chrysler can grow in Canada, if the market can grow," Lewenza said.

He said Chrysler has customer confidence, quality products and momentum, and the contract will not kill any of that.

However, unlike the previous two deals, no new investment came with the agreement. The Ford deal added 600 jobs and the GM deal added or maintained 1,750 jobs.

Chrysler, meanwhile, will continue to run three shifts in Windsor and two in Brampton through the lifetime of the agreement, according to Lewenza.

"You cannot bargain airtight job security," Lewenza said.

Tony Faria, the co-director of office of automotive research at the University of Windsor's Odette School of Business, said the contract is geared to the current workforce and not the future of Canadian auto workers.

"The leadership of the CAW has pulled out the best deal it conceivably could," Faria said.

He called it a "cost neutral contract."

"There was no doubt where Chrysler was going to have to go with the contract. They were going to have to agree to all major aspects of the deal reached with Ford and GM," Faria said.

Minivan's future cloudy

Lewenza said he anticipated a makeover of the minivan during the next contract but that makeover may be put off until the end of the new four-year agreement.

"I think Chrysler is being very strategic in their capital spending," Lewenza said.

"Mr. Marchionne has lots of reasons to invest in Canada," Lewenza said of the company's CEO, Sergio Marchionne.

"The contract is not going to bring out the job guarantees the CAW would have liked," Faria said. "Chances are we’re going to see Canada lose some production."

Lewenza called on governments — federal and provincial — to help land auto investment in Canada.

For the last two weeks, Lewenza insisted all three U.S. automakers would agree to similar collective agreements.

He continually said it would take three or four days of tough negotiations with each company before deals were reached.

The Chrysler deal ends nearly two weeks of negotiating between the CAW and the Detroit Three automakers.

Lewenza called the negotiations with Chrysler "stressful" and "respectful."

Earlier Wednesday, the CAW posted an encouraging message on its Facebook page.

"Negotiations with Chrysler went on until 5 a.m. [Wednesday] morning, continuing with the hope of reaching a deal later tonight," it read.

CAW members at the Detroit Three

General Motors: 8,194 members

  • Locations: Oshawa, Woodstock, St. Catharines, Ingersoll (the CAMI plant in Ingersoll is not part of these negotiations)

Chrysler: 8,049 members

  • Locations: Brampton, Windsor-Essex, Etobicoke

Ford: 4,534 members

  • Locations: Windsor-Essex, Oakville, Bramalea

Total members, Detroit Three: 20,777

Source: CAW

Lewenza told Reuters the automaker submitted a written economic proposal to the union Tuesday night.

Chrysler employs more than 8,000 unionized employees in Ontario. Approximately 5,000 work at Windsor Assembly Plant where the company’s flagship minivan is built. Another 3,000 work in Brampton, building the Chrysler 300 and Dodge Chargers and Challengers. Just over 200 work at Etobicoke Casting.

In Windsor, in anticipation of a deal, CAW Local 444 had already booked facilities at Caesars Windsor for an information or ratification meeting on the weekend. The ratification vote is now scheduled for Sunday.

Dino Chiodo, president of CAW Local 444 in Windsor, encouraged his members to vote in favour of the agreement.

"There was no concessionary bargaining. We traded off nothing," Lewenza said.

Last of Detroit Three deals

Chrysler management declined to discuss the terms of the agreement Wednesday.

"We extend our appreciation to our Canadian workforce for their patience during this pivotal round of collective bargaining," vice-president of employee relations, Al Iacobelli, wrote in an email. "We will not comment on the details of the tentative agreement during the CAW ratification process."

The CAW reached a tentative agreement with General Motors on Sept. 20. Hourly unionized employees are set to vote on that deal this week.

The union and Ford reached a deal Sept. 17, hours before a strike deadline. The Ford deal was the template for the other two Detroit Three U.S. automakers. Workers there ratified by 82 per cent.

The GM deal also includes investment at plants in Ontario. Lewenza announced GM will create or maintain 1,750 Canadian jobs and invest $675 million in capital spending in Canada.

With files from The Canadian Press