Talks with Canadian auto union still deadlocked: Chrysler

Sunday, March 29, 2009 at 9:29 PM Posted by Beijing News


The Canadian branch of ailing US automaker Chrysler and the Canadian Auto Workers union have not yet reached an agreement to reduce costs, Chrysler's chief negotiator said in a statement Saturday.

"After several days of bargaining in good faith, Chrysler and the CAW have not reached an agreement that closes the competitive gap with other automobile manufacturers in Canada, to ensure Chrysler's immediate viability," said Al Iacobelli, Chrysler's chief bargainer.

If both sides fail to reach an agreement, Chrysler has vowed to permanently shutter its Canadian operations, putting some 8,000 Canadians out of work.

Both sides "recognize that we are in unprecedented times as it relates to the global economy and current financial crisis, which has a direct impact on the automotive industry," Iacobelli said.

Chrysler "has been very clear in its Canadian government testimony and position with the CAW: we must 'close the competitive gap' of 19 dollars an hour immediately, with a goal of not having to affect base wages and pensions; while contributing to Chrysler's viability with direct annual savings to the bottom-line in the current year, and each of the remaining years of the contract," Iacobelli said.

Negotiations began Monday on trimming labor costs before the deadline to qualify for a bailout of some 2.5 billion dollars from the governments of Canada and Ontario province.

GM reached a deal with its approximately 10,000 Canadian workers on March 8 to freeze wages and pensions, and reduce holiday pay. The cost savings are estimated to be worth tens of millions of dollars.

In return, GM has pledged in its restructuring plan to maintain up to 20 percent of its North American production in Canada.

Chrysler, however, said the GM cuts, which were to be used as a template in negotiations with Chrysler, were not deep enough.

GM and Chrysler have so far received 17.4 billion US dollars in US loans following a collapse of auto sales amid a deepening recession, and have asked Washington for an additional 21.6 billion US dollars.

GM is also asking for up to 7.5 billion Canadian dollars 6.0 billion US in aid from the governments of Canada and Ontario province, which boasts the largest auto sector segment in North America.

Chrysler, with some 8,000 assembly, auto parts and office workers in Canada, has asked Ottawa for a one billion dollar 800 million US bridge loan.

CAW president Ken Lewenza told reporters Friday that the union "is committed to stay" negotiating in Toronto "until March 31st to continue to tackle the issues that may divide us."

Already, Chrysler has started mapping out its withdrawal from Canada, local media reported.







Lions enjoy the sun in their enclosure at a zoo, March 29, 2009. REUTERS/Ali Jarekji

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