CAW Reaches Cost-Cutting Agreement with Ford, Secures Canadian Footprint
October 30, 2009, 3:15 PM EST
The CAW has reached a tentative agreement with Ford Motor Company that follows the pattern established at General Motors and Chrysler in the spring, while maintaining the company's manufacturing base here in Canada. The new agreement expires on September 17, 2012.
"During the negotiations, Ford threatened that if we didn't come to an agreement, the company would begin shifting investment out of Canada," said CAW President Ken Lewenza. "In today's globalized economy where companies attempt to bypass community commitments, it's crucial that we don't allow this to happen."
"Ford sells hundreds of thousands of vehicles in Canada each year and we must ensure that they continue to employ Canadians in the production of just as many vehicles."
As part of the deal, Ford has made a series of production and investment commitments at its Canadian facilities including any potential derivative engines from its base design architecture in Windsor and new vehicles (to be produced off a new global vehicle platform) in Oakville. Under those product commitments, Canada will account for 10 per cent of Ford's total North American manufacturing output over the term of the new agreement. Under those product commitments, Ford will continue to manufacture more than it sells in Canada - as was formerly required under the old Canada-U.S. Auto Pact.
"This footprint commitment was an important achievement for the union," said Lewenza.
For the Oakville assembly plant, Ford committed to allocating a new global platform to the Oakville flex plant, which will produce at least two new-generation vehicles in the next product cycle. During the course of the collective agreement, two models - the Edge and the Lincoln MKX will also get a major refresh.
In Windsor, Ford committed to a new premium engine in the Essex Engine plant as well as the sole source for all variants of the engine. Work generated by new components related to a growth in volume will be in-sourced dependent upon an acceptable business plan. Additionally the Windsor Engine plant will continue to be the sole source for the 5.4 litre engine for the life of the product, as well as the 6.8 litre engine.
During the course of negotiations, the company confirmed that the St. Thomas assembly plant would be closing in the third quarter of 2011, despite the union's best effort to keep the facility open. As part of the closure, workers will receive enhanced severance and retirement packages. Ford has also committed to providing funds to set up an action centre to assist workers who are unemployed as a result of the closure.
"This was a very difficult round of negotiations," said Mike Vince, chairperson of the CAW-Ford Master Bargaining Committee and president of CAW Local 200.
"Nothing was harder though than coming to the realization that regardless of whatever suggestions the union came up with to save the St. Thomas facility, Ford would be closing the plant. This is a terrible blow to St. Thomas, which has already suffered massive job loss in this recession."
The CAW represents approximately 7,000 Ford workers across the country.