Ford and GM Reach CAW Agreement, Chrysler Still Negotiating

Good news for Canada's auto industry came this week with the announcement that Ford workers have ratified the deal that had been struck between labour and management.  Ford employees were the first to come to terms with the three major American car companies currently engaged in heated negotiations with the Canadian Auto Workers union.  General Motors workers have also managed to find common ground with their employer.

The new agreement between Ford and the CAW is centered around the suspension of a cost of living salary adjustment for the next three years.  Instead, Ford workers will receive bonus payments, entry-level wages will be cut, and it will also take longer for recently hired workers to top out in terms of wages.  Pension plan details have additionally changed for new employees.

Ford - along with GM and Chrysler - had been aggressively seeking salary reductions in order to make it feasible to continue operating plants at full capacity in Canada.  Canadian automotive workers are amongst the best compensated in the world, and the strength of the Canadian dollar has put a strain on the ability of the Big Three to make an economic case for their large presence in the country.

Chrysler remains on the outside looking in when it comes to labour relations.  The automaker has rejected the latest overtures from the CAW despite being offered similar terms as those tendered to - and accepted by - Ford and General Motors. Chrysler continues to balk about the costs associated with the proposed plan, and company spokespeople have repeatedly stated that a need exists for CAW workers to match their UAW counterparts in America in terms of wages.  A strike that could close Canadian Chrysler plants remains a possibility if the two sides cannot see things eye-to-eye.