General Motors Co. is at risk of a shutdown of its Canadian plants as a strike deadline approaches without an agreement in sight, adding to the labor concerns of an automaker that’s already battling with the United Auto Workers.
(Bloomberg) — General Motors Co. is at risk of a shutdown of its Canadian plants as a strike deadline approaches without an agreement in sight, adding to the labor concerns of an automaker that’s already battling with the United Auto Workers.
Unifor, which represents Canadian auto workers, is trying to get GM to match a new three-year deal it signed with Ford Motor Co. that includes a 19% wage increase for more experienced workers and a 28.5% pay bump for junior union members. So far, the union is meeting “resistance on a number of fronts and elements,” Unifor President Lana Payne said in a phone interview.
Unlike the UAW, which has called strikes at all three Detroit automakers, the Canadian union is sticking with a traditional “pattern bargaining” approach, securing a contract with one company and then trying to get the other two to match it. Unifor has set a deadline of Oct. 9 at 11:59 p.m. Toronto time for a GM deal.
The stakes are high for both sides. GM has continued to churn out pickup trucks from its plant in Oshawa, Ontario, during the US dispute. Unifor, meanwhile, is dealing with friction in its ranks: its members only narrowly approved their agreement with Ford, raising the pressure on Payne in negotiations with GM and Stellantis NV.
“It is always an uphill battle because no employer likes to have to take on the terms and conditions that we’ve bargained with a completely different employer,” Payne said. “But it works for our members because we can make sure that companies are not competing based on trying to lower wages for auto workers across the sector.”
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Key issues in the negotiations include the transition of part-time to full-time workers, a health allowance for retirees and the confirmation of future investments in Canadian plants. One reason GM’s talks are different than Ford’s is the younger demographic of its Canadian workforce. Matching the Ford agreement would be costlier for GM, giving more of its workers larger increases in pay.
“These corporations do not come to the bargaining table on bended knee. They put up a fight and and so we have to fight and push back,” Payne said. “I would suggest to them that they would want to reach this pattern before the deadline, or there’ll be picket lines.”
GM at Disadvantage
Payne said workers have “incredible leverage” in Canada. In addition to the Oshawa truck plant — which is doing shifts around the clock producing Chevrolet Silverado trucks and other products — GM also has a transmission and engine plant in St. Catharines, Ontario that serves plants in other countries. Unifor represents about 4,300 workers in this round of talks.
The combination of the UAW strikes and Unifor’s deal with Ford “puts GM at a disadvantage,” according to Wedbush Securities analyst Dan Ives. The longer the UAW strikes drag on, he added, the higher the likelihood of a major impact on Canadian operations. “If it lasts another week or two, it would be a gut punch.”
So far, the automakers have said their Canadian operations are unaffected by the UAW strike that is roiling production across the border. However, GM shut down a plant in Ingersoll, Ontario, that makes BrightDrop electric cargo vans on Sept. 15 — the same day the UAW strike began. The company said it suspended production because of delays in securing battery equipment.
“The UAW strike action against GM does not directly impact our Canadian operations at this time,” GM Canada communications director Monte Doran said in an emailed statement, adding that the company is in talks with Unifor “to build a competitive future that also recognizes our employees’ contributions to our shared success.”
Still, anxiety is rising in cities where the GM has operations as the labor deadline approaches.
“Certainly, we don’t want to see people without work and not being employed but I think the good news is that people are seeing investments,” Ingersoll Mayor Brian Petrie said by phone. “The anxiety would be a lot higher if those things weren’t happening.” GM Canada is currently expanding its Ingersoll plant, which will eventually employ more workers, Petrie said.
Stellantis said that in the past 18 months, it has announced billions of dollars in new investments in Canada to create 3,000 jobs, including for electric vehicles. “There is no change to our investment announcements in Canada,” spokesperson LouAnn Gosselin said by email. Stellantis won’t be at the bargaining table with Unifor until a new GM agreement is ratified, she said.
In the long run, the automakers view the Canadian union’s negotiating tactics as more strategic and consistent than the UAW’s, said Wedbush’s Ives. “It’s been a lot more rational north of the border than we’re seeing take place in Detroit,” he said. “I think they’ll double down on their Canadian operations and also focus on Mexico.”
Once Unifor reaches a deal with GM, there’s still a challenge ahead for its negotiation with Stellantis. It’s got two assembly plants in southern Ontario and plans to modernize both as part of its ambitious electric vehicle plans.
“With Stellantis, I know it, I can hear it, I’ve heard it from them before, they’ll be here kicking and screaming, saying we have the largest footprint in Canada and this agreement is going to cost us more than anybody else,” Payne said. “I’m like, yes, it will. But that is the reality of what we do in pattern bargaining.”
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