Chrysler will quite Canada if CAW doesn't concede: Execs.

This is from Canwest.

Nothing like bargaining with threats. The auto workers have given up everything that they fought for over the years and it remains to be seen if even those on pensions will be safe. Probably not. Nothing like a crisis to wring concessions from the working class.


Chrysler will quit Canada if CAW doesn't concede: execs


By Nicolas Van Praet, Canwest News ServiceApril 18, 2009


Chrysler LLC's two top executives sent their Canadian employees a letter on Friday, warning that if its 8,000 factory workers do not agree to pay cuts, the automaker will no longer build cars in Canada.
``The clock is running. Without labour concessions, Chrysler Canada's manufacturing operations will not survive long-term,'' chief executive Bob Nardelli and president Tom LaSorda said in the letter. ``Thousands of good- paying jobs are in jeopardy, as well as the economic health of communities such as Windsor and Brampton (Ont.).''
Chrysler insiders describe the letter as nearly unprecedented in that it was sent only to Canadian employees, and that it was also distributed in the company's factories and parts depots. Typically, e-mails from senior executives only go only to employees with work stations and e-mail addresses.
In a reponse later in the day, Canadian Auto Workers union president Ken Lewenza lumped the letter together with what he called ``an unprecedented and outrageous series of attacks on Canadian autoworkers and their union.''
He acknowledged others such as Fiat CEO Sergio Marchionne, federal Industry Minister Tony Clement and Chrysler Canada CEO Reid Bigland as leading the attack on workers earlier in the week.
Lewenza defended Canadian labour's role in the auto industry by saying hourly costs in this country are ``significantly lower'' than in the U.S., and that Canada has been an ``incredibly successful and profitable place for Chrysler'' in past years.
The executives told employees that the Canadian government has set four conditions for continuing to support Chrysler with further funding, all of which have to be reached by an April 30 deadline. The company must lower all-in labour costs by $19 an hour, to the same level as that of Toyota Motor Manufacturing Canada. It also has to complete an alliance with Italian automaker Fiat SpA, commit to maintaining production and capital investment in Canada based on the country's share of Chrysler's overall North American output, and submit revised restructuring blueprints to the Canadian and U.S. governments outlining Chrysler's Canadian footprint and future manufacturing plans.
``Time is very short. We have only two weeks before a final decision must be made,'' the letter said. ``Let me be clear, our negotiations are about saving Chrysler Canada. We are coming down to the wire in the fight for our company's survival - and we need your support.''
The Canadian and Ontario governments have pledged $1 billion to Chrysler to help it stabilize its Canadian operations, which include a minivan assembly factory in Windsor and car plant in Brampton, just northwest of Toronto. Chrysler has drawn down $750 million of that, the company said. Ottawa and Queen's Park have pledged more support, proportional to the $6 billion US Washington has also pledged, if Chrysler meets the new targets set.
``While we have made some progress with the CAW, it falls significantly short of closing the $19 gap,'' the Chrysler executives said in the letter. ``And yet, as recent as Wednesday this week, the CAW continues to ignore this clear mandate from the government stating that they will not go any further. This unwillingness to work within the government's guidelines jeopardizes the future of Chrysler and our operations in Canada.''
The letter outlined several proposals the automaker has made to the CAW as a way to shave labour costs without affecting base wages and pensions, including: eliminating the cap on prescription drug dispensing fees; nixing out-of- province health care coverage for snowbirds; and eliminating life insurance for current and future employees.
The CAW has opposed these solutions but Chrysler is open to alternative ideas, the executives said. Bargaining between the CAW and the company is expected to resume Monday after breaking off late last month.
General Motors Corp. faces a May 31 deadline to cut debt and strike its own new labour deal with unions in Canada and the United States. Federal Industry Minister Tony Clement said Thursday he will not use taxpayer money to support the companies further without concessions from labour.
Asked if he is willing to let the companies fail if labour does not agree to the cuts demanded, he said: ``We have to examine every possibility.''
Canwest News Service
nvanpraet@nationalpost.com
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