General Motors and the Canadian Auto Workers union announced that they've reached a tentative deal for a new contract that will create or save 1750 jobs, bring some $675 million in new investment to the General's Canadian plants, and -- perhaps most importantly -- avoid a strike.
The CAW-GM pact is said to closely follow, if not mirror, the plans recently reached between the union and the Ford Motor Company. GM promises that no seniority workers will be laid off (for the first time in 20 years) and some production amendments could result in a net increase in jobs for Canadian assembly plants.
Most of the changes revolve around the Oshawa, Ontario plant that currently builds the Chevrolet Camaro, Buick Regal, Cadillac XTS, and Chevrolet Equinox. GM said earlier this year it was planning to close a major consolidated production line at Oshawa, resulting in a loss of 2000 jobs. Production of the Chevrolet Impala, which has long been built in Oshawa, was scheduled to move exclusively to GM's Detroit-Hamtramck Assembly Plant in Michigan once the new model bows next year.
It looks like CAW bargainers were able to prompt the General to scale back those plans. The second production line at Oshawa will be reduced to one shift, although it retains the option to go to two shifts in the future. Oshawa will also get some production duties for the 2014 Impala, and a sizable chunk of GM's planned $675 million Canadian investment. A separate "flex line" at the Oshawa plant will also gain a third shift, which will boost employment there by 900 jobs. Additionally, GM's St. Catherine's Engine Plant in Ontario will also get an employment boost, as it will likely produce the 3.6-liter V-6 engines that will be used on the Impala.
In return for the boost in jobs, GM managed to freeze wages and cost-of-living adjustments for the next four years, although CAW workers will receive a $3078 ratification bonus this year and a $2052 lump-sum cost-of-living payments in 2013 through 2015.
With the CAW on good terms (and solid footing) with Ford and GM, it turns its sights to the most important player in the Canadian auto game, Chrysler. Considering that Canadian assembly plants produce some of the company's most popular vehicles, like the Chrysler 300 and Town and Country, the CAW may have more leverage than with the other two to extract concessions.
Source: Detroit News