Bombardier (TSX:BBD.b)and unionized workers at its de Havilland aircraft plant in Toronto have reached a deal that avoids a shift of production out of town.

The new three-year agreement was reached close to midnight ET on Thursday after several weeks of bargaining, the Canadian Auto Workers said in a release.

On March 5, Bombardier announced plans to layoff 3,000 workers from its aerospace division. The company said a majority of the job losses would be in Canada – roughly 1,800 jobs were supposed to go in Montreal and Toronto. Actual cuts depended on negotiations with the CAW in Toronto, the company said.

Planning job cuts

• FROM March 5, 2003: Bombardier laying off 3,000 workers at aerospace division

The de Havilland plant produces the turboprop regional aircraft and the Global Express corporate jet. Bombardier had threatened to move production of the Global Express jet to Montreal.

CAW president Buzz Hargrove told CBC Business News the deal includes a firm commitment from the company that the the Global Express and turboprop regional planes will continue to be built at the de Havilland plant.

The deal doesn't include wage concessions, but it does have retirment incentives, cost of living-based wage increases and a small pension improvement.

Workers will vote on the deal Saturday.

Shares of Bombardier closed down 8 cents at $3.42 on Friday.