• Oct 3, 2009
it wasn't long ago that U.S. automakers were producing a high percentage of their new products in Canada because labor costs were lower up north than are here in the States. The cost paradigm changed considerably after GM and Chrysler went into Chapter 11 reorganization, as the ailing automakers secured better labor deals with both U.S. and Canadian unions, making the UAW and CAW more competitive versus Japanese automakers.

The United Auto Workers renegotiated with Ford, giving Dearborn terms similar to those it gave GM and Chrysler. Ford reportedly told The Globe and Mail that it now pays about $52 per hour for U.S. labor after benefits. Unfortunately for Ford, the CAW hasn't extended the same helping hand labor-wise, and the Blue Oval isn't very happy. Ford says it is paying $16 more per hour for its Canadian workforce than it is for U.S. workers. In fact, Ford says its labor situation in Canada is so bad that the Blue Oval alleges its labor costs there are now higher than in any other region on earth.

The Canadian Auto Workers union appears willing to negotiate, but The Globe and Mail reports that it wants job security in return. Ford's St. Thomas plant, which currently builds the Panther-platformed Lincoln Town Car, Ford Crown Victoria and Mercury Grand Marquis, is scheduled for closure at some point in the next two years, and the CAW would like Ford to instead guarantee a new product for the facility. The CAW says it wants to continue to account for 13. So far, neither party seems to be budging, but we have a feeling Ford won't be paying the highest labor rates anywhere for very much longer.

[Source: The Globe and Mail]


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  • 51 Comments
      • 5 Years Ago
      The CAW's economists can prove that when you take higher productivity into account, these are NOT the highest rates.
        • 5 Years Ago
        I can prove, all things considered, that I am the most awesomest person in the world.


        Why the hell would you trust anything the CAW says? They're just like the UAW...but in Canada.
        • 5 Years Ago
        Actually, they aren't the same. CAW split from UAW in the eighties because of philosophical differences.

        As CAW Chief economist Jim Stanford says, "Today active labour cost per vehicle is lower in a CAW plant than in a non-union US transplant."

        Supporting presentation (fully footnoted) is here: http://www.caw.ca/en/5440.htm

      Derek
      • 5 Years Ago
      I'm not your buddy, guy!
        • 5 Years Ago
        @Derek
        I'm not your guy, friend!
      • 5 Years Ago
      Wonder how long unions will last in North America.
      • 5 Years Ago
      Having factory workers say what plants need to be used is no way to run a factory. This is one of the big problems they had before
      • 5 Years Ago
      Well number one, timmy the tool should stop posting because his comments and opinions are completely ignorant and unnecessary. For him to believe that Ford should pull all of their manufacturing operations out of Canada is absurd. Canadian autoworkers the most highly productive in the world, which produce vehicles that either have none, or few issues (rarely).
      Another aspect is the labour cost dispute. Manufacturing costs in Canada are normally higher than our American counterparts because Canadians pay more in taxes and general items cost more than they do in the U.S.A. So for those idiots who do not live in Canada, much like timmy the tool, please understand that Canada is more expensive than the U.S. Also, for the other moron who believes that autoworkers make over 100 thousand plus annually is smoking some hard drugs because those numbers are absolutely ludicrous.
      Stop feeling sorry for American corporations. They are nothing more than money-hungry, blood-sucking profit hounds who just want to fill their own personal bank accounts.
      • 5 Years Ago
      If they didn't ask for so much Ford might have kept it open. For them it's either cut their wages and still have a job or it's lose your job completely. Pretty much they're just asking to be let go.
        • 5 Years Ago
        Everyone seems extraordinarily challenged by reading comprehension today.

        The story implies the union is willing to take a wage cut if the factory is kept open. Whether the factory is worth operating with cheaper wages is something only Ford knows... we'll find out when they make their decision.
      • 5 Years Ago
      Ford's sales might be on the rise, but they are still operating well below capacity. Personally, I'd like to see Ford just pull all of their manufacturing out of Canada. I don't know how practical it would be, but it would sure as hell give the UAW a wake-up call. Actually, it's the members that need a wake-up call. With the recent round of concessions, the UAW is no more than an extra layer of bureaucracy that the workers have to pay for. In the past, the automakers were indirectly paying for it due because of the much higher raises the UAW demanded, but in an economic downturn the UAW is powerless because their members need jobs more than the automakers need workers.
        • 5 Years Ago
        Honestly, I think ford should keep building the crown vic in Canada and let them keep their jobs, as long as they'll make wage concessions first. The police love those things and ford easily sells 65,000 of them a year, probably with a good profit margin as r&d costs were taken care of long ago. All the car needs is some new hardware, possibly a 300hp version of the 4.6 v8 and a 5 or 6 speed auto would do quite nicely. The cops would love the upgrade for pursuits and for fuel economy.
      • 5 Years Ago
      They became the most expensive when the Canadian dollar approached parity with the US dollar. It was offsetting a big heaping of payroll and other assorted taxes. The disparity is more the fault of the Canadian government than the CAW.
      • 5 Years Ago
      Why not move the line to China, it is manufacturing super power for a reason.
        • 5 Years Ago
        yeah, the workforce is barely above slave labor.
      • 5 Years Ago
      Let the products die out and then close down the Canadian factories and move production to the US problem solved....Or better yet move production down south to Mexico...
      • 5 Years Ago
      As I see it, CAW needs to bring Ford's labor rate within the same deal the Government Companies have received - if not - kiss your jobs goodbye. We can play fancy with the stats and with exchange rates and comparisons, but those slight of hand tricks IGNORE that Ford is paying MORE than GM or Chrysler for Canadian labor.

      CAW - adjust your rate to parity with Government companies or consider yourself unemployed. Don't like it? Oh well!
      • 5 Years Ago
      Too Easy...

      "And, I'm not your Eric, Clapton"

      XD
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