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The Canadian Auto Workers (CAW) have ratified a generous deal with Ford– frozen wages, no two-tier tears at bedtime– by a reported 67 percent margin. (I guess the other 33 percent thought they could get blood out of a stone). Even more flabbergasting: the contracts aren't even up until September. CAW boss Buzz Hargrove says [via The Detroit News] that GM and Chrysler will go down just as fast, just as hard. "They will accept the same economic terms. It's only a question of when. I'm hoping it will be in the next week or so." Not so fast, Mr. Bond. Chrysler's teetering on the brink of bankruptcy. They got no game. And GM, well, GM's got 32 U.S. plants off-line (including all the key ones), the prospect of more union action to come, sweet F.A. going on in its high profit margin SUV and truck biz, and a cash conflagration that could heat Hoboken for a week. Buzz? Buzz wants GM to commit more product to the Ontario factory. Never mind that the Peso is worth less than a Canadian Loonie. Or the fact that GM builds trucks in five other factories, including two in Silao and Toluca, Mexico). Still, look for GM to roll over and play dead (it's who they are and what they do), while Chrysler delays the inevitable (selling everything to Magna) for as long as possible. 17 Comments on “CAW Turns its Guns on Struggling GM, Defenseless Chrysler...”
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Ford is launching the new Flex and also needs Essex Engine to supply V8 cranks for the Romeo Engine Plant launch of the new 6.2l V8. If Buzz strikes Chrysler or GM they might not even notice.
E-mail from a CAW official
You ought to know better! You were a representative at Pillette Road where we had three different investment commitments and the plant ultimately closed because of market share losses. Chrysler as well as Ford and GM continue to shrink so there is no such thing as “protection” if your reference is to jobs.
The recent economic agreement is a huge victory for Big Three workers because the changes we made were kept at a minimal. Why is that? Ford, Oakville is expected to launch their third shift – very important vehicle to their survival so it made sense to utilize that only pressure tactic we had and the timing is perfect. GM and Chrysler (as witnessed by the American Axle Strike) could go down and nobody would even care. We would have to call them to advise them we are on strike. Huge inventories, and slowing sales are getting worse by the minute. Buzz seized the moment – progressive thinking and took full advantage of the one card in the deck. I am involved in every strategic decision of the Union, so please feel comfortable in contacting me directly. The auto industry’s “historic domestic” is in serious, serious trouble and the market is huge reason for concern.
I’m sure this is a terribly, terribly naïve question, but given all the slack at other GM plants, why couldn’t GM pull all their production out of Canada? I am not asking to be mean or because I want any of our neighbors to the north to lose their jobs, but what exactly is keeping GM from taking their ball and going home? Given the belligerence of CAW’s leadership, why is it off the table?
Reminds me of the UAW’s strike against Studebaker’s South bend plant in 1962, just as the Avanti entered pre-production. How’d that one work out, guys?
Yeah, let them turn their guns on Chrysler and GM…them promptly shoot themselves in the foot.
They do seem a bit oblivious to what is happening with both of those manufacturers.
Ah – the CAW (Cancer-like Automotive Woes) just cannot see the future for the short term dollars. Parasites need to learn that in order to survive longer they need to coexist with the host and not kill it. It is a prisoner’s dilemma they never seem to understand.
Why, this is better than watching football!!
BTW, thanks jthorner for the nice write-up. It’s nice to see readers taking the spirit of journalism upon themselves…I think it’s great.
We don’t need no de Lorenzo. Those self-important types make me nauseous anyway. I have to admit, I started off reading that yahoo on the web, but I cannot tolerate his GM apologist attitude. It’s sickening.
I’ll take native grown talent any day :) Keep it up.
GM Canada wont be pulling out of Canada any time soon as they have too much invested here as well as they keep getting Gifts of Cash from the Ontario Government, besides they sell a lot of vehicles here as well as the ability to do so ie if you dont build them here, you cant sell them here!
So if the General won’t play ball Buzz goes to Chrysler?Works for me we got a COLA increase coming June 1st.
Lets face we don’t want eat concesions period thus the 67%{40% turn out eh}
So union bashing aside,hows anybody figure your gonn’a sell the GM people on less than Ford got?
Is GM hurtin?I certainly don’t see any sacrifice on managements part.JT HORNER has it right GM will cave.Anything different would require management skills,wich are in short supply here at GM.
This is slightly off-topic, but I’m surprised that TTAC never picked-up on the recent announcement by Ontario Premier Dalton McGuinty (shown at left in the pic for this article) that he is “in talks” with other auto manufacturers to build a new plant in Ontario. Fiat and the Chinese were mentioned. Good luck with that.
http://network.nationalpost.com/np/blogs/fpposted/archive/2008/04/29/ontario-premier-confident-province-will-get-new-auto-plant.aspx
http://www.theglobeandmail.com/servlet/story/LAC.20080506.RFIAT06/TPStory/Business
PS: I’d like to propose a caption for the picture. “…and then I told them I wasn’t going to introduce any new taxes!”
Seems to me that it takes two parties to come to an agreement. So the real question must be why does GM “management” imagine that it isn’t a good contract. Do you really think that they sign a union contract just because it is in the best interest of the union, or have they decided that it’s a good deal for the company and its sharecroppers. Holding wages flat and giving up a weeks holidays isn’t for everyone. Are you prepared to do it? Are the 10,000 GM execs prepared to do the same? I think we know the answer to both these questions.
I have a modest proposal (pun intended). Tie the benefits packages, both hourly and management, to market share (exclusive of fleet sales). Build a popular product, get a bonus. Build a stinker (insert Big 2.8 car model here) then you get nothing! If the Big 2.8 are as good as they say they are, then they should have nothing to worry about.
The general concensus is that in order for them to sell in Canada, they need to build in Canada. Makes sense. Question – what is the number of sales that were in Canada for GM in 2005, 2006 and 2007? Anyone?
GM Canada wont be pulling out of Canada any time soon as they have too much invested here as well as they keep getting Gifts of Cash from the Ontario Government, besides they sell a lot of vehicles here as well as the ability to do so ie if you dont build them here, you cant sell them here!
In my state (Indiana), Honda is building a new plant to build not union made Civics to start with. Everyone is excited to have them here, plus for the economic spin-offs and opportunities. Who doesn’t want a well made car manufacture? Kind of has that long term outlook!
Personally, I own two Jeeps after once owning two Hondas. I’m wanting to add a third new car, and guess what it’s going to be? If you guessed a Honda, you guessed right.
Does anyone else think Ford may have done their agreement with the CAW so early and with such favorable terms so as to push either GM or Chrysler into the abyss of C11?
Ford is the one company of the Big 3 that can’t really go C11 because the Ford family’s wealth and control of the company would be wiped out. As such, with their renewal program taking hold and looking to pick up steam in 2009/2010 with new product, why not see if they can add the dead-cat bounce too?
Crazy?
Lichtronamo:
Ford is the one company of the Big 3 that can’t really go C11 because the Ford family’s wealth and control of the company would be wiped out. As such, with their renewal program taking hold and looking to pick up steam in 2009/2010 with new product, why not see if they can add the dead-man bounce too?
Not crazy at all. This is a game of Last Man Standing. If Chrysler and then GM go belly-up, the dead cat bounce will be HUGE.
Only one problem: a resurgent, post-C11 Chrysler or GM. Hmmm. Nah.
Chrysler is never coming back fro C11. Carlos Ghosn will make off with Dodge trucks and Jeep leaving Chrysler cars to the Chinese or Indians.
If GM is to survive C11, the courts will have to install a CEO with Ghosn or Mulally’s capabilities to walk into the big office and ask “WTF is going on here?!” Kill products, brands, dealers and please, oh, please Bob Lutz (or at least demote him to PR chief).
” Does anyone else think Ford may have done their agreement with the CAW so early and with such favorable terms so as to push either GM or Chrysler into the abyss of C11?”
I’ve certainly been wondering if caving early is part of Mulally’s master plan somehow. He doesn’t seem like the kind of guy who does things for no good reason.