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CAW Ratifies Chrysler Contract
The Canadian Auto Workers (CAW) union has ended this year’s talk with the U.S. automakers by ratifying the 4-year agreement with Chrysler Group LLC, majority-owned by
Fiat SpA . About 90% of union members have voted in favor of the deal.
Among the Detroit Big Three, Chrysler operates the largest facility in Canada. The agreement covered 8,000 workers employed by the company in Ontario including vehicle-assembly plants in Brampton, near Toronto, and Windsor, located in Southwestern Ontario.
These plants produce some of the company’s top-selling lineups. The Windsor plant manufactures Dodge Grand Caravan and Chrysler Town & Country minivans. They were the fourth and fifth best selling models of the company last year.
The CAW union has already ratified agreements with Ford Motor Co. ( F - Analyst Report) and General Motors Company ( GM - Analyst Report) recently. The agreement with Chrysler followed the same pattern as the GM and Ford.
Under the agreement, workers will be paid 60% (instead of 70% previously) of the highest hourly wage rate of C$33.89 (US$34.74), which means $20.33. The starting wages would take 10 years to reach the highest hourly rate instead of 6 years.
The deal also included lump-sum payments of C$2,000 ($2,050) in lieu of raises and a C$3,000 ($3,076) ratification bonus. Chrysler also offered protection of current pension benefits to existing workers and job creation in all locations.
According to the Detroit automakers, Canada is considered the most expensive country in the world for manufacturing cars. The CAW union represents about 21,000 workers in Canada and contributes 16% of vehicle production in North America.