Navistar confirmed Tuesday that it intends to close its Chatham, Ont., truck assembly plant.

The company said in a statement Tuesday that the plant has been idled and employees have been on layoff status since 2009 "due to the company's inability to reach a collective bargaining agreement with the Canadian Auto Workers."

"It's not a surprise, but it doesn't take the disappointment away," Canadian Auto Workers president Ken Lewenza said after Tuesday's announcement.

Lewenza criticized the decision to shut the plant and said the proposal put forward by the company "was not ratifiable."

"It's troubling … without that facility truck manufacturing in Canada is taking another blow," Lewenza said ahead of the announcement.

He said the only good thing about Tuesday's announcement is that it finally brings closure for the workers.

"You can't keep 1,000 people that remain on the seniority list — 350 active when we were laid off, but 1,000 total on the seniority list — waiting for another day or waiting for another rumour or waiting for another announcement," Lewenza said. "It's been very, very tough on the community."

The truck plant has been idle for the past two years. At its peak in the late 1990s, the facility employed more than 2,000 workers, he said.

Navistar is building its heavy duty commercial trucks in the United States and Mexico.

The company said the Chatham production has already been absorbed by other truck plants.

Lewenza said the union will meet with company representatives soon to discuss plans to "reduce the pain on the members through retirement and severance options."

Randy Hope, Chatham's mayor, said the real economic impact of the closure was felt in 2009 when the plant was idled.

"Nothing will ever replace the high-paying jobs that were there in that facility," Hope said before the company made the announcement.

Hope wants to have a discussion with the company about the fate of the large site on Richmond Street. The Chatham plant has been around for well over 100 years, he said.

According to the CAW, Navistar benefited from over $60 million in federal and provincial funding over the years, as well as $40 million in contract savings from union members.

Karen Denning, a Navistar representative, said the company would do whatever was necessary to meet any outstanding obligations tied to government funding.

Corrections

  • A previous version of this story misstated the amount of government funding Navistar received. According to the CAW, the company benefited from $60 million in funding from the federal and provincial governments and $40 million in contract savings from union members.
    Aug 02, 2011 5:26 PM ET