Monday, September 24, 2012

Chrysler Finds CAW Deal Too Expensive - Ford Motor (NYSE:F), General Motors (NYSE:GM)

Canadian Auto Workers and Chrysler Group LLC engaged in constructive talks on new contract on Friday, as told by the head of the union. However, the discussion remained apart with the automaker complaining that the template deal with the union was expensive.

Chrysler is the only Detroit Three auto manufacturer that does not have a contract in Canada after the union has reached a four-year tentative deal with General Motors Company(NYSE:GM) overnight following the agreement on Monday with Ford Motor Company(NYSE:F).

The Ford deal set the union’s bargaining prototype with other two companies and Ford workers will vote on it this weekend.

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CAW National President Ken Lewenza said that the company has constructive discussions with Chrysler.
Pattern bargaining is a tradition of the CAW under which the first deal reached negotiations with the automakers become the template for deals with other two. It is designed to make sure that no company has a labor cost benefit over the others.

Lewenza mentioned in an interview that Chrysler is still saying that the pattern is expensive. CAW is still discussing whether or not to tweak it. Lewenza hopes they can come up with something creative.

The union represents about 20,000 workers at the Detroit Three. It has asked Chrysler for a written proposal in reply to the Ford deal.

Discussions with Chrysler at the master bargaining level involve Lewenza. This is likely to slow over the weekend as the senior CAW officials will travel to Ford’s plants that are located in southern Ontario. Workers there will vote on their contract.

Discussions at the sub-committee level are supposed to continue over the weekend at a downtown Toronto hotel. Talks have happened for more than a month. Lewenza said that he had hopes of getting a deal at the starting of next week, Peter Kennedy, CAW secretary- treasurer said that he would be happy if CAW can wrap this issue by Monday. 

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