• Mar 12th 2009 at 12:59PM
  • 10
The Canadian Auto Workers union has ratified a new contract with General Motors that should help substantially reduce the automaker's operating costs in Canada. The template of the agreement is very similar to the one reached here in the U.S. between Ford and the UAW recently.
CAW said 87% of its GM workers voted to accept frozen wages, paying more for health care and losing some paid time off, among other rollbacks. However, the cuts won't take effect until Canada's government finalizes and distributes aid money to General Motors. The U.S. automaker has asked the Canadian government and province of Ontario for up to C$7 billion ($5.4 billion) in loans.

UPDATE: GM's official statement included after the jump.

[Source: Automotive News, sub. req'd]

GM Statement Regarding the Ratification of the CAW Agreement and Update on Cash position

Attributable to Ray G. Young, GM executive vice president and chief financial officer

As GM Canada announced last night, the members of the Canadian Auto Workers (CAW) union have ratified a new competitive agreement with GM Canada (GMCL), which is vital to the continued transformation of the Canadian operations. The agreement between GMCL and the CAW will quickly reduce costs in Canada by significantly closing the competitive gap with U.S. transplant automakers on active employee labor costs and substantially reducing GMCL's legacy costs by introducing cash contributions for health benefits, increasing employee health care cost sharing, freezing pension benefits and removing hourly pension cost of living adjustments.

In addition, GMCL and the CAW will work together with the Canadian government to explore the possibilities of adopting a similar approach to the GM UAW VEBA in the U.S. GM is also continuing its negotiations with the Canadian and Ontario governments for support for the Canadian operations during this unprecedented industry downturn.

In the U.S., GM has also indicated they have advised the Presidential Task Force on The Auto Industry that the $2 billion of funding previously requested for March would not be needed at this time. This development reflects the acceleration of GM's company-wide cost reduction efforts as well as pro-active deferrals of spending previously anticipated in January and February. GM will remain in regular contact with the Presidential Task Force on the Auto Industry on the status of GM's restructuring actions, its liquidity position, timing of future funding requests, and other relevant topics of mutual concern.

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    • 1 Second Ago
      • 6 Years Ago
      The agreement hardly took anything away from the workers or retirees. Pensions and wages stay the same with no increase for cost of living until 2012. Since the rate of inflation is almost 0% anyway, what are they giving up? NOTHING. $1700.00 bonus going to retirees to help with paying for benefits. G.M is saving 148 million with this latest contract. SO WHAT, GM is burning though 2.5 billion a MONTH. Chrysler needs to die and GM needs to go bankrupt. The CAW needs to get a new reality.

      The government needs to keep our money and not blow it on money losing companies and money grubbing unions.
      • 6 Years Ago
      anyone know about the PUNTA CANA trip for GM employees
      earlier this month?

        • 6 Years Ago
        No, but that shows good taste. Punta Cana beats the hell out of Las Vegas. Chances are, the spent quite a bit less than they would have in Vega$.
      • 6 Years Ago
      Seems like CAW members like their jobs more than UAW members. That's a much higher approval percentage than the Ford/UAW amendment.
      • 6 Years Ago
      Seems to me that Canadian workers understand better the current industry risks and challenges than US workers.
        • 6 Years Ago
        Yes....and they will have jobs for awhile to help them further understand the situation while Chrysler UAW members are off whining to their congresspersons.
      • 6 Years Ago
      Meanwhile Chrysler threatened to pull out of Canada if Canada does not forgive Chyrsler`s near billion dollars of back tax AND a loan of 2.3 billion dollars.
      • 6 Years Ago
      GM is a black hole, they have proven that! Poor design, Poor quality, Poor workman ship, and over paid labor( by 25.00 per hr. ). Americans wont buy there products. Americans hearing all these stories about the UAW,how they work, and how much they are paid,plus health care and pensions, most Americans wont support GM or the UAW !
        • 6 Years Ago
        I say offer them Walmart money and threaton to ship all the manufacturing jobs to China!
      • 6 Years Ago
      Key comment - GM doesn't need money . . . for now.