Toyota recalls 157,000 vehicles in Canada to fix airbags and wipers

By The Canadian Press - Wednesday, January 30, 2013 at 5:53 AM - 0 Comments

TORONTO – Toyota Canada said Wednesday it is recalling more than 157,000 vehicles to fix airbags and window wipers.

They include more than 140,000 Corolla and Matrix cars from 2003 and 2004 and almost 17,000 Lexus IS models from 2006 through 2012.

The Corolla and Matrix cars are being recalled because of concerns their airbags could be deployed inadvertently due to a possible short circuit in the control module.

The automaker also said the wiper arms of the Lexus vehicles may not be sufficiently tight and may stop working if their movement is restricted, by a buildup of snow for example.

Continue…

Toyota back at No. 1 with 2012 car sales—dethroning GM officially

By Yuri Kageyama, The Associated Press - Monday, January 28, 2013 at 8:03 PM - 0 Comments

TOKYO – It’s official: Toyota is once again the world’s top automaker.

Toyota Motor Corp. released its tally for global vehicle sales for last year Monday at a record 9.748 million vehicles — more than last month’s estimate of about 9.7 million vehicles.

It was already clear Toyota had dethroned General Motors Co. as the Detroit-based automaker fell short, selling 9.29 million vehicles.

GM had been the top-selling automaker for more than seven decades before losing the title to Toyota in 2008.

GM retook the sales crown in 2011, when Toyota’s production was hurt by the quake and tsunami in northeastern Japan.

The latest results show Toyota’s powerful comeback.

Global vehicle sales for the maker of the Camry sedan, Prius hybrid and Lexus luxury model surged nearly 23 per cent from the previous year. Overseas sales jumped 19 per cent, while sales in Japan, where the economy has been troubled, recovered a whopping 35 per cent.

Volkswagen AG of Germany, the world’s No. 3 automaker, sold a record 9.1 million vehicles around the world.

All three automakers play down the significance of the sales ranking and say they are focused on making attractive products.

“Rather than going after numbers, we hope to make fine products, one by one, to keep out customers satisfied. The numbers are just a result of our policy. And our policy will continue unchanged,” said Toyota spokeswoman Shino Yamada.

Still, the recovery for Toyota is impressive. Like other Japanese automakers, Toyota’s production was devastated by the March 2011 disasters, which disrupted supplies of crucial components. Flooding in Thailand, where Toyota has factories, also hurt car production.

Before that, it struggled against a crisis of massive recalls in the U.S. over defective floor mats, gas pedals and brakes, involving millions of vehicles, some recalled over and over, that hurt its reputation for quality.

Toyota officials have vowed to scrutinize quality, and have held back product development to minimize recalls.

From the middle of last year, it was hit by another kind of problem — a widespread boycott of Japanese products, including Toyota cars, in China over a territorial dispute.

But sales growth in other parts of the world, including the U.S. and Asian nations such as Indonesia and India, was more than enough to offset such losses.

Toyota is planning to sell 9.91 million vehicles globally in 2013, putting it back on track toward its earlier goal of 10 million vehicles — a target that it had made a special effort to play down after its recall crisis.

Toyota back at No. 1, dethroning GM officially

By The Associated Press - Monday, January 28, 2013 at 4:00 AM - 0 Comments

TOKYO – Now it’s official: Toyota is once again the world’s top automaker.

Toyota Motor Corp. released its tally for global vehicle sales for last year Monday at a record 9.748 million vehicles — a bigger number than the estimate it gave last month of about 9.7 million vehicles.

It was already clear Toyota had dethroned General Motors Co. as the Detroit-based automaker fell short, selling 9.29 million vehicles.

GM had been the top-selling automaker for more than seven decades before losing the title to Toyota in 2008.

GM retook the sales crown in 2011, when Toyota’s production was hurt by the quake and tsunami in northeastern Japan.

The latest results show Toyota’s powerful comeback.

Continue…

GM exec says car maker will invest $1.5B in U.S. factories this year

By The Associated Press - Thursday, January 17, 2013 at 1:19 PM - 0 Comments

DETROIT – General Motors says it will invest $1.5 billion in its North American factories this year.

North American President Mark Reuss announced the figure in a speech Wednesday night but gave no details. The company says specific plants and job numbers will come later.

The president of GM Canada, which exports much of its production to the United States, was similarly vague about the company’s plans earlier this week.

GM is revamping 70 per cent of its U.S. models as it switches from the oldest lineup in the industry to the newest. Continue…

Investment fund for auto sector gets 5-year extension from Ottawa

By David Friend - Friday, January 4, 2013 at 3:21 PM - 0 Comments

OAKVILLE, Ont. – Ottawa is extending an auto sector fund that provides a $250-million pool of investment cash over five years for car companies and their suppliers.

Prime Minister Stephen Harper, speaking at the Ford plant in Oakville, Ont., said the Automotive Innovation Fund has helped Canada’s auto sector become more innovative, agile and competitive.

“The rebound of our auto sector in this country is one of Canada’s biggest economic and industrial success stories of the last five years,” said Harper, while cautioning the “global economy remains troubled.” Continue…

Car owners unite against the bike!

By Kaj Hasselriis - Wednesday, November 21, 2012 at 7:30 AM - 0 Comments

Mal Langsdon/Reuters

Every weekday, Juliana Park wakes up in her Paris apartment near leafy Bois de Vincennes park, carries her 10-month-old daughter two blocks to the nearest metro station, drops her at a nanny’s, then heads to work—sometimes by foot, sometimes by bike, but never by car. In fact, the Canadian-born architect is rarely in a car. “You really have no excuse in Paris,” she says.

Park, it seems, is far from the only Parisian going car-free: car use in Paris has dropped 25 per cent in the last 10 years. Bike use, meanwhile, has doubled, and one out of every two trips now happens on foot. Park is glad that, while navigating cobblestone sidewalks, her daughter gets a child’s-eye view of bakeries, crepe stands and schoolchildren on scooters, instead of seeing it all whoosh by from the back seat of a car. “Even though she’s still really young,” says Park, “she’s getting a better sense of her environment.” Paris Mayor Bertrand Delanoë, who has eliminated 23,000 parking spots to make way for bike and bus lanes and built the massively popular Vélib’ bike-sharing network (an idea later copied in Montreal, Toronto and Ottawa), is at least partly responsible for Paris’s new, bike-friendly face. But the mayor’s latest plan—to pedestrianize a section of the Seine riverbank—is causing a powerful lobby group, 40 millions d’automobilistes, to fight back. “We can no sooner eliminate cars from Paris roads than empty the Seine of water,” says executive director Pierre Chasseray. “Delanoë is living a fantasy.” Continue…

Chrysler US sales jump 12 per cent for company’s best September in 5 years

By The Canadian Press - Tuesday, October 2, 2012 at 9:35 AM - 0 Comments

DETROIT – Chrysler’s U.S. sales rose almost 12 per cent last month as the company reported its best September in five years.

The increase from a year earlier was fueled by new models, low interest rates and a stable U.S. economy, the company said. Its sales chief predicted that September sales for the industry would reach an annual rate of 14.9 million, making it the best month since March of 2008. Car companies report sales throughout the day on Tuesday.

The company’s performance shows that Americans continued to buy new cars and trucks at a strong pace this year, making auto sales a steady bright spot in a cloudy economy. Cheap loans and leases, aging cars that need replacing, and a new lineup of fuel-efficient midsize sedans are drawing shoppers to dealerships.

“We remain optimistic about the health of the U.S. new vehicle sales industry and our position in it,” said Reid Bigland, Chrysler’s head of U.S. sales.

Most analysts are slightly more conservative than Chrysler in their predictions for September. Still, U.S. sales could rise by more than 1.1 million vehicles, up 11 per cent from last year, for an annual rate of about 14.5 million.

Sales would be even stronger were it not for uncertainty about the broader economy. Some people are holding back on major purchases until they see how the budget battle shakes out in Washington, whether Europe can fix its economy and who wins the U.S. presidential election, said Jeff Schuster, senior vice-president of forecasting for LMC Automotive, an industry consulting firm.

Schuster expects September sales at an annual rate of 14.5 million, perhaps more if automakers finished the month stronger than expected. Bargain interest rates are largely fueling sales, he said. Some banks and credit unions offer 2 per cent financing to people with good credit. That’s almost as good as subsidized loans from the automakers’ finance companies.

“Not only is it cheap, it’s relatively available,” Schuster said. “There’s no question that’s driving buyers.”

Also, used-car values have remained high due to tight supplies and strong demand, and that means dealers are paying more for trade-ins.

And there are a bunch of new models coming out, especially in the midsize car category, the most popular segment of the U.S. market. Honda’s new Accord and a new Ford Fusion are just hitting showrooms, as is a revamped Chevrolet Malibu. The redesigned Nissan Altima is selling well. A new Toyota Camry, the top-selling car in America, has been in showrooms for only a year.

The new models have ready buyers. People are replacing aging cars they held onto during the 2007-2009 recession, and that’s been helping sales all year. The average age of cars and trucks on U.S. roads is near 11 years.

A midsize sedan led Chrysler’s September sales. Sales of Dodge Avenger jumped 89 per cent from a year earlier, helping lift the company’s overall U.S. sales to 142,000 vehicles last month. The Jeep Grand Cherokee SUV also notched a strong month with sales up 19 per cent. But the company’s bestselling vehicle, the Ram pickup, posted only a 6 per cent increase following a stronger August.

One thing that will be absent from September sales is big discounts from automakers. The average incentive for the month was $2,468, down almost 7 per cent from September of last year, according to the TrueCar.com auto pricing site.

Even with uncertainty, there’s enough good economic news to help sales, which could reach an annual rate of 15 million this month, according to Morgan Stanley analyst Adam Jonas.

Consumer confidence, one of the biggest factors influencing car-buying, jumped in September to the highest level since February. It was bolstered by a brighter outlook for overall business conditions and hiring.

Checks with dealers found higher floor traffic in mid-month “driven by aggressive lending and marketing activity, particularly for trucks,” Jonas wrote in a note to investors.

Sales of 15 million would still fall short of the recent peak of around 17 million in 2005. They bottomed at a 30-year low of 10.4 million during the recession in 2009.

Canadian workers at Chrysler accept tentative contract

By The Canadian Press - Sunday, September 30, 2012 at 9:05 PM - 0 Comments

TORONTO – Unionized workers at Chrysler’s Ontario plants voted to accept a new contract on Sunday, marking the Canadian Auto Workers’ successful negotiation of fresh agreements with the three big U.S. automakers.

The Chrysler workers voted 90 per cent in favour of the tentative deal which was reached last week.

It was not immediately clear how many of the 8,000 workers at Chrysler’s plants in Toronto, Brampton and Windsor cast ballots in the ratification votes held this weekend.

The deal was based on agreements already accepted by CAW members at Ford and General Motors by margins of 82 per cent and 73 per cent.

The four-year contract includes lump sum payments as well as job security provisions.

It also pays new employees less and extends the time it takes them to get to the top of the pay scale.

Chrysler was the last of the Detroit Big Three automakers to hammer out a contract.

CAW President Ken Lewenza said the ratification of all three new agreements will now allow the union to focus on winning a national auto policy for Canada.

“One of our objectives coming into these talks was to position our industry for future growth and success, and we did as much as we possibly could on that front,” Lewenza said in a statement released Sunday evening.

“But without a comprehensive sector development strategy, the future of auto manufacturing in Canada remains uncertain, at best.”

He said a national auto policy could lay the groundwork for the industry’s ongoing competitiveness and success and added that the union would be renewing efforts to win federal support for the issue.

The CAW’s proposals for a national policy include the development of an auto investment policy, building a green industry and a buy-Canadian vehicle purchasing strategy.

The CAW represents 21,000 workers at the Big Three automakers.

GM recalling 40,859 cars for cracked part

By The Canadian Press - Saturday, September 29, 2012 at 12:38 PM - 0 Comments

DETROIT – General Motors Co. is recalling more than 40,000 cars sold in warm-weather states because a plastic part might crack and cause a fuel leak.

The company is recalling Chevrolet Cobalt and Pontiac G5 sedans from the 2007 through 2009 model years and Chevrolet Equinox and Pontiac Torrent SUVs and Saturn Ion sedans from the 2007 model year.

The recall affects vehicles sold or currently registered in Arizona, California, Florida, Nevada or Texas. Owners in Arkansas and Oklahoma also are included in the recall of the 2009 Cobalt and G5.

The vehicles have plastic parts connected to the fuel pump which could crack. If the crack gets large enough, fuel could leak out of the vehicle and cause a fire.

GM says there have been no reports of fires or injuries related to the defect. The company began investigating the issue in 2011 after a dealer reported fuel leaking from some vehicles.

GM says its warranty data indicates that the problem is far more common in warm-weather states. It will repair the vehicles for free in those states. Owners will be notified of the recall by mail.

But the company also plans to send letters to owners in other states offering a free repair within a limited time period if the parts are cracked. That offer is valid for 10 years or 120,000 miles from the date the vehicle was sold, spokesman Alan Adler said.

The National Highway Traffic Safety Administration announced the recall on its Web site Saturday.

Canadian workers at Chrysler vote on tentative contract

By The Canadian Press - Saturday, September 29, 2012 at 8:20 AM - 0 Comments

TORONTO – Members of the Canadian Auto Workers union at Chrysler begin voting on a tentative deal today.

Meetings are scheduled today and tomorrow for workers at Chrysler’s Ontario plants in Windsor, Brampton and Toronto.

Shop floor leadership at the factories have already unanimously endorsed the four year deal reached this week.

The deal includes lump sum payments as well as job security provisions.

The deal is based on agreements accepted by CAW members at Ford and General Motors earlier this week.

The contracts allow the Big Three North American automakers to pay new employees less and extends the time it takes them to get to the top of the pay scale.

CAW says framework deals improve competitiveness of Canadian auto sector

By Ross Marowits, The Canadian Press - Thursday, September 27, 2012 at 10:05 PM - 0 Comments

The Canadian Auto Workers union says the new collective agreements it has negotiated with the three big U.S. automakers will protect workers by improving the competitiveness of the Canadian manufacturing operations.

CAW president Ken Lewenza says the tentative contracts reached over the past week with Ford, General Motors and Chrysler will better position their operations in Ontario to combat pressures such as the high value of the loonie.

Some auto sector analysts had expressed concern that the automakers might re-think their medium to long-term commitments to manufacturing vehicles in Canada after the pattern deal was reached with Ford.

But Scotiabank senior economist and automotive analyst Carlos Gomes said Thursday that the new contracts improve competitiveness, adding they will likely attract additional investment from existing producers.

“I think it makes us competitive going forward. But the reality still is that if you look at what’s happening in the industry, all of the new plants are going in primarily to Mexico or the U.S. south,” he said in an interview.

Lewenza said Thursday he would have liked to see long-term investment commitments by the automakers but he believes those decisions will be announced in the coming years as they prepare for updates towards the end of the decade.

The federal and Ontario governments need to adopt strategies that protect the Canadian auto sector by counteracting enticements offered by jurisdictions seeking to lure relocations, he added.

The deals reached with the Detroit Big Three allow the automakers to hire new employees at lower pay and benefit rates for a 10-year phase-in period, while keeping hourly wages for current employees steady over the life of the four-year contract.

Existing workers will instead receive $9,000 over four years in a ratification bonus and payments in lieu of cost-of-living increases.

New hires at Ford, GM and Chrysler factories in Canada will begin their careers at C$20 an hour, down from the C$24 starting wage under the previous deal, and take 10 years to reach peak pay levels of C$34 an hour instead of the six years.

New employees will also receive hybrid pension plans instead of pure defined benefit plans for current employees.

“In all three collective agreements, the new wage progression positions us much better than we were positioned before bargaining,” Lewenza said in an interview.

CAW members at Ford voted in favour of their agreement on the weekend by a margin of 82 per cent. General Motors workers ratified the deal by a margin of 73 per cent, the union announced Thursday.

David Wenner, general director of labour relations at GM Canada, said the company appreciates the “frank and straightforward dialogue” with the union.

“Since 2009, GM has announced significant product allocation and investments in our Canadian manufacturing facilities demonstrating our commitment to Canada,” Wenner said.

“Throughout the next four years, we will continue to leverage our partnership with the CAW to identify opportunities to enhance the competitiveness of our Canadian operations.”

Chrysler workers will vote on Saturday and Sunday.

Lower starting wages should make the Big Three automakers more competitive with Honda and Toyota’s operations in Canada, Lewenza added.

The CAW leader said he expects the Japanese manufacturers will reduce their wages for new hires to keep them “in the ball park” with their North American rivals.

“The same way they responded up, they will respond on a weighted average.”

A leaked memo to employees from Honda in April said it pays virtually the same $35 per hour maximum hourly compensation as GM. Honda’s base wage is $30.90 per hour compared to $33.91 for GM. But bonuses erase the gap.

The main difference with the Big Three is that the Japanese automakers rely heavily on contract workers to adjust to demand and don’t have legacy retirement costs.

Honda declined to confirm its wage rates but said the total package, including bonuses “are very competitive with other plants in the Canadian automotive industry.”

Chrysler CEO Sergio Marchionne had wanted Canadian autoworkers to adopt the permanently lower wage scales that their U.S. counterparts did last year under contracts negotiated by the United Auto Workers union.

In the U.S., new workers start at US$15.50 per hour and can rise to US$19.28 per hour compared with the US$28 per hour top rate paid to existing employees.

But Lewenza said the CAW insisted on a 10-year salary grid for new, younger workers.

“That generation will do what I had to do — fight for wages, even fight to improve the wage progression once we get the bargaining strength to do that,” he said.

“So I don’t see it as a sacrifice at all. In fact, I see it as being flexible and creative to win investment, to win new jobs.”

Lewenza described negotiations as very challenging as they initially strayed from past practice. He called Ford’s move to set the pattern for other contracts a “real turning point” to avoid a strike.

The union could have stubbornly refused to alter new hire wage rates and the existing six-year grid, but instead chose to make changes to perhaps entice investment even though the automakers have done little hiring in the last decade, he added.

Consequently, he said the agreements negotiated with Detroit’s automakers should pave the way for future investment despite not containing any guarantees after 2016.

The agreement preserves three shifts at Chrysler’s minivan plant in Windsor, Ont., and two shifts at the assembly plant in Brampton. Ford and GM agreed to create 600 and 1,750 jobs respectively.

Canadian Auto Workers reaches deal with Chrysler

By The Canadian Press - Wednesday, September 26, 2012 at 9:21 PM - 0 Comments

TORONTO – The Canadian Auto Workers union reached a tentative agreement with Chrysler on Wednesday, signalling a successful end to labour negotiations at all Big Three automakers without resorting to a strike.

The deal meets the pattern set in deals already reached with Ford and General Motors, said CAW president Ken Lewenza.

Chrysler will be better positioned in the industry as a result of the negotiations, he added.

The union’s tone with Chrysler had changed dramatically from a week ago when Lewenza had urged the automaker to “get serious” and table a proposal that followed the pattern set with agreements at Ford and General Motors.

The CAW reached a tentative agreement with Ford on Sept. 17, which workers accepted by a margin of 82 per cent. The union also reached an agreement with General Motors on Sept. 20, which is in the process of being voted on.

Industry observers have said those deals gave Chrysler little choice but to accept the framework agreement — Chrysler’s Canadian operations account for 25 per cent of its global production, the largest of the U.S. automakers.

The automaker had been concerned about being bound to the framework agreement established by Ford and GM that pays lump sum payments over four years in lieu of cost-of-living and wage increases.

Under the pattern deal first reached with Ford, each worker will get $2,000 a year in the second, third and fourth years of the contract to cover cost-of-living increases, plus a $3,000 ratification bonus.

Long-term care provisions have also been capped at $800 per month for new hires and the prescription drug plan has been changed to reduce costs.

New hires at Ford, GM and Chrysler will also begin their careers at $20 an hour, down from $24, and take 10 years to reach peak pay levels of $34 an hour instead of the six years it currently takes.

New employees will also receive hybrid pension plans instead of pure defined benefit plans for current employees.

In the U.S., new workers start at US$15.50 per hour and rise to US$19.28 per hour compared with the US$28 per hour top rate paid to existing employees.

In the United States, Chrysler workers received lower lump sum payments than Ford and GM workers.

Chrysler doesn’t want to follow the others because it presents itself as a smaller, different company.

Ford hopes to cut several hundred salaried workers in Europe through buyouts

By The Associated Press - Tuesday, September 25, 2012 at 9:17 PM - 0 Comments

DETROIT – Ford Motor Co. said Tuesday it plans to cut several hundred salaried workers in Europe as part of a larger restructuring in the money-losing region.

The company is offering voluntary buyout programs in Germany, the U.K. and the rest of Europe. It’s also cutting temporary salaried positions and some outsourced services.

Ford stressed that the separations will be voluntary. The Dearborn, Michigan-based company expects several hundred people will leave, but it won’t know exact figures for several months.

Europe’s economic crisis has hurt car sales, which dropped nearly 7 per cent in the European Union in the first six months of this year. Ford also has been hit by an influx of cheaper imports from South Korea after Europe lowered its tariffs on Korean vehicles last year.

Ford lost $404 million in Europe in the second quarter. It expects to lose $1 billion in the region this year.

In addition to the salaried staff cuts, Ford is studying plant closures and other cost-cutting measures. The company has said it is using its North American restructuring — in which it closed plants, renegotiated union contracts, accelerated new products and laid off thousands of workers — as a template for Europe.

“I think we have a track record in terms of understanding what needs to be done and having the will and the ability to execute it,” Chief Financial Officer Bob Shanks said last week at a conference for manufacturing analysts.

Earlier this month, Ford announced plans to bring 15 new or restyled vehicles to Europe over the next five years to revive sales. Among the new offerings will be the Mustang sports car, EcoSport small SUV and Edge mid-size SUV. Shanks said Ford’s lineup in Europe isn’t as profitable as it could be right now because it’s heavily tilted toward smaller, less profitable cars.

Shanks also warned analysts that the restructuring will take time.

“The recovery of Europe will not be a two-quarter phenomenon,” he said.

Ford shares fell 2 per cent, or 23 cents, to close at $10.09.

Ford offering $50,000 and new car voucher to encourage early retirements

By The Canadian Press - Monday, September 24, 2012 at 10:13 PM - 0 Comments

Armed with a new collective agreement ratified over the weekend, Ford is offering a $50,000 incentive to about 1,000 employees eligible for early retirement in order to recall hundreds of laid-off workers.

“We will be offering certain retirement-eligible employees an incentive to retire from the workforce to allow our employees on layoff opportunities to return to work,” spokeswoman Lauren More said in an email.

The incentive available in the fourth quarter will also provide a voucher for a new car along with the standard pension program.

Ford has about 800 employees on layoff. It agreed in negotiations to investments that could create about 600 new jobs its assembly complex in Oakville, Ont.

A third shift will be added to the body, paint and pre-trim departments along with additional work that will create about 300 jobs. A new product will add more than 300 positions.

Ford’s Windsor operations will also receive additional machining work, generating about 35 new openings.

The collective agreement was supported on average by 82 per cent of members who participated in a ratification vote last weekend.

Recalled employees won’t be affected by lower starting wage rates. Consequently, More said it’s too early to say how much money could be saved from lower starting rates for new hires.

“Further savings will depend on how many opportunities we have in the future to utilize the new employee provisions we negotiated, as their labour rate will ‘blend’ with those of current employees,” she said.

Still, Ford said the wage and pension structure for new employees realigns labour costs to be “more competitive” with deals recently negotiated in the U.S. with the UAW.

Newly-hired Canadian workers will earn about $20 an hour, down from $24 an hour. It will take the new hires 10 years to reach the same wages as existing employees. They will also be converted to hybrid pension plans instead of defined benefit plans like current employees.

New workers in the U.S. start at US$15.50 per hour and rise to US$19.28 per hour. That’s short of the US$28 per hour top rate paid to existing employees and C$34 per hour paid in Canada.

General Motors declined to provide details about its agreement that will be voted on by about 5,500 CAW members on Wednesday.

“This set of talks with our labour partner have been candid and constructive, reflecting the challenges facing Canadian manufacturers,” stated David Wenner, general director labour relations.

Meanwhile, the Canadian Auto Workers urged its members at Chrysler to be patient as formal talks resumed Monday as the two sides try to reach a tentative agreement that avoids a costly strike.

“It’s crucial that members at all Chrysler locations stay on the job and continue working,” the union told its members in an update on negotiations.

“A failure to do so will have serious negative consequences on our ability to reach a new agreement and will greatly diminish the bargaining committee’s negotiating power.”

The union said it will give 24 hours notice of a strike if talks with Chrysler flounder. Employee tensions are high because company CEO Sergio Marchionne has been vocal about his desire for substantial contract changes and his opposition to pattern bargaining with rivals Ford and General Motors.

However, the union said tentative agreements with Ford and GM provide the framework it will follow with Chrysler.

Industry observers say Chrysler has no choice but to accept the pattern four-year agreement since it can’t afford a strike. Canada accounts for about one quarter of its global production.

“We are in a much stronger position today, with one pattern agreement ratified and another on its way. We are more confident today that Chrysler can and will meet the pattern,” the bargaining committee said.

CAW president Ken Lewenza said last week that he was hopeful an agreement with Chrysler could be reached within a few days.

University of Windsor business professor and auto expert Tony Faria said he’s surprised that the union is willing to give Chrysler “as much as this whole week” to finalize a deal.

“But it hardly matters. The final contract is going to be just about identical to GM and Ford, possibly tweaked around the very, very fringes of it but basically all major provisions identical.”

The agreement Ford workers accepted has no increases to wages or changes to pension plans for existing employees.

Each worker will get $2,000 a year in the second, third and fourth years to cover cost-of-living increases, plus a $3,000 ratification bonus.

Long-term care provisions are capped at $800 per month for new hires and the prescription drug plan is changed to end coverage of drugs that do not require a prescription for dispensing.

Auto industry sees road blocks in China

By macleans.ca - Monday, September 24, 2012 at 1:18 PM - 0 Comments

Carmakers have long seen a road paved with gold in China. The country currently accounts for almost 25 per cent of global car sales, and Chinese buyers have a fondness for foreign brands. (Volkswagen has the biggest auto-market share in the country.) For the past two years, however, Chinese auto sales have been slowing down sharply. Last month, growth in the industry was just 3.7 per cent, down from 11 per cent in July. Two years ago auto sales were growing by a healthy 32 per cent. By 2011 that number had dropped to 5.2 per cent.

The worrisome figures come at a time of general turmoil in the world’s second-largest economy. This month, China’s economic growth has been its weakest since the global financial crisis began in 2007—unsettling news for automakers who are banking on growth in China’s auto sector amid weak demand in the United States and Europe. By 2007, mostly foreign companies had invested $25.5 billion in the market, and in 2009, China overtook America to become the world’s largest auto market.

While the weakening economy remains a chief concern, automakers are facing yet another threat: the government. In July, Guangzhou became the fourth city in China (after Beijing, Shanghai and Guiyang) to limit auto sales in an attempt to halve the number of cars on the road in an effort to fight congestion and pollution problems. The crackdown could eventually do more than just hurt local sales for automakers. Anthony Faria, director of the office of Automotive Research at the University of Windsor, says excess production in China could eventually result in the country exporting product to North America, undoubtedly hurting plants in Canada and the U.S.

Continue…

Chrysler to resume talks with the union

By The Canadian Press - Monday, September 24, 2012 at 5:39 AM - 0 Comments

TORONTO – The Canadian Auto Workers is set to sit down with Chrysler again today in hopes of putting together a tentative agreement.

The CAW says the two sides held some informal discussions Sunday and hopes it can nail down an agreement this week.

The union chalked one up Sunday when its membership at Ford accepted a deal reached last week.

The union says 82 per cent of the 3,000 workers who voted accepted the deal _ the CAW represents a total of 4,500 Ford workers.

The union’s membership at General Motors will vote on Wednesday and Thursday on a deal that was also reached last week.

The agreement Ford workers accepted has no increases to wages or changes to pension plans for existing employees.

Each worker will get $2,000 a year in the second, third and fourth years to cover cost-of-living increases, plus a $3,000 ratification bonus.

The deal will also result in roughly 600 jobs created at Ford’s assembly complex in Oakville, Ont.

Unionized Canadian workers at Ford accept contract

By The Canadian Press - Sunday, September 23, 2012 at 7:34 PM - 0 Comments

TORONTO – Ford Canada’s unionized workers accepted a new contract over the weekend that will see the company’s plants bolstered by more than 600 planned new jobs but lower wages for new hires.

The Canadian Auto Workers says 82 per cent of its members who voted approved the Ford deal, which was the first collective bargaining agreement reached between CAW negotiators and the Big Three North American automakers.

The CAW represents more than 4,500 Ford workers. A total of 3,000 voted, a union spokeswoman said.

The union and General Motors agreed on Thursday to a tentative deal _ similar to the Ford agreement. GM workers were to start voting on the offer Wednesday.

Chrysler and the CAW have still not reached an agreement, but the union said it was optimistic it can reach one within a week.

The union is in legal position to strike if at any point progress seriously stalls in the talks. It has promised to give 24 hours notice before a work stoppage.

Meanwhile, the CAW was hailing the Ford deal for securing existing jobs and adding new ones at Ford’s Canadian operations during a rocky economic environment.

“This new agreement will ensure that our facilities are well-positioned for a strong future in the North American auto industry,” CAW President Ken Lewenza said in a statement.

A key issue for automakers has been keeping their Canadian costs competitive with U.S. plants at a time when the high Canadian dollar is putting the squeeze on the manufacturing sector.

The three automakers had initially pushed for permanent lower wages for new hires in the contract talks — a proposal fiercely opposed by the union.

Under the Ford deal — used as a blueprint for CAW’s talks with GM and Chrysler — new hires will make 60 per cent of full pay, which would be reached 10 years later, instead of after six years as in the last collective agreement.

New hires will also be signed up for a hybrid pension plan, rather than a defined benefit plan for current workers.

The four-your deal with Ford contains no increases to wages or changes to pension plans for existing employees. Each worker will get $2,000 a year in the second, third and fourth years to cover cost-of-living increases, plus a $3,000 ratification bonus.

The deal will also result in roughly 600 jobs created at Ford’s assembly complex in Oakville, Ont., with another 35 at its Windsor, Ont., branch, Ford said in a release.

“By becoming more competitive in our labour costs, we are better positioned to support the growth of the Canadian economy and to provide new job opportunities,” Stacey Allerton, a vice-president with Ford Canada and the company’s chief labour negotiator, said in a statement.

CAW members vote on Ford deal over weekend

By The Canadian Press - Saturday, September 22, 2012 at 5:02 AM - 0 Comments

TORONTO – Ford workers in Hamilton and Windsor, Ont., vote today on a four-year deal reached this week that has been endorsed by their union leadership.

Other Ford ratification meetings will be held Sunday in Windsor and Brampton, Ont.

The Canadian Auto Workers says the proposed contract would create new employment opportunities for hundreds of laid off workers and provide cost of living lump sum payments.

CAW President Ken Lewenza says despite the endorsement from union negotiators, it’s up to rank-and-file members to decide.

Ratification meetings for General Motors employees on a tentative deal that will maintain 1,750 jobs that had been in question will be held next Wednesday in Oshawa, Ont.

The CAW says it hopes it’s just days away from reaching an agreement with Chrysler, though Chrysler has been reluctant to follow a pattern deal reached with its rivals.

“I’m optimistic that within the next three or four days we can get the job done,” Lewenza said Friday.

Lewenza said Chrysler is fully aware that following the pattern set by its American rivals is essential for the union.

“If it breaks down in any way, we’ll give the 24-hours notice and we’ll utilize the tool but I’m anticipating we won’t need to do that in the next three or four days,” he said.

The GM and Ford deals will see new hires paid a lower rate, $20.40 an hour, which equals 60 per cent of current base pay and progressing to full pay in 10 years, longer than the six years agreed upon in the last agreement.

They will also be converted to a hybrid pension plan, which is less burdensome to the company than the defined benefit plan that current employees receive.

All employees at both automakers will receive a $2,000 annual cost of living lump sum payment and a $3,000 ratification bonus.

CAW reaches tentative deal with GM, Chrysler remains

By The Canadian Press - Friday, September 21, 2012 at 12:11 AM - 0 Comments

TORONTO – The Canadian Auto Workers union hammered out a tentative agreement with General Motors on Thursday that will keep some 1,750 jobs in Ontario, making Chrysler the final of the Detroit Big Three still at the bargaining table.

“This was a difficult couple days,” CAW president Ken Lewenza told a news conference Thursday night. “It was tough sledding.”

“At the end of the day what came out of this thing is consistent with what we did at Ford,” said a tired-looking Lewenza, whose union has been in round-the-clock negotiations since Monday when a midnight strike deadline was put off after the union reached a deal with Ford.

After reaching a tentative deal with Ford on Monday, the CAW turned to getting similar deals at both Chrysler and General Motors — a practice known as pattern bargaining.

Lewenza said the GM deal incorporates the entire Ford pattern — including a 10-year progression to full pay and a hybrid pension plan for new employees, as well as a $2,000 annual cost of living lump sum payment and a $3,000 ratification bonus for all employees.

The GM deal will also see 1,750 jobs created, maintained or extended.

That includes 900 jobs through the addition of a third shift at the flex plant in Oshawa, Ont., beginning early next year, and the extension of the life of the consolidated plant in Oshawa, which had been slated to close in 2013. Instead, the company will continue to operate at least one shift until June of 2014, extending at least 750 jobs and potentially more if a second shift is also extended.

In addition, about 100 new positions will be created or maintained at its plant in St. Catharines, Ont.

The company also committed to $675-million in investments over the term of the agreement.

The agreement also reverses concessions made in the last round of bargaining that allowed to use temporary workers indefinitely, and limits the use of those workers during the launch of a new vehicle.

“What I get out of this set of negotiations is for the first time in over 20 years at the end of this collective agreement we will have no seniority workers on layoff at General Motors,” Lewenza said.

“And if the market conditions improve as General Motors rebuilds their company, we’ll have the opportunity to give young people jobs at General Motors for the first time in two darn decades if not more.”

The key sticking point in negotiations was over a two-tier wage system — GM wanted to see new hires permanently earn less than current employees, Lewenza said.

He urged Chrysler to “get serious” and table a proposal that follows the pattern, adding that it seemed “reluctant” to do so, appearing to make a “strategic decision” to allow the union to focus on GM, but talks continue with the automaker.

Earlier Thursday, the union indicated it was making some headway with Chrysler, saying the company seems to be more willing than it was to reach an agreement.

Still, the union is in legal position to strike if at any point progress seriously stalls in the talks. It has said it will give 24 hours notice before a work stoppage.

Canadian Ford auto workers will vote this weekend on the tentative agreement and the CAW said results of the vote will be released on Sunday night. The vote for GM workers has yet to be scheduled.

GM Canada said late Thursday that the four-year tentative deal covering about 5,500 CAW members was arrived at around 9 p.m. ET, adding that it would not disclose terms of the agreement because it was still subject to ratification.

“This set of talks with our labour partner have been candid and constructive, reflecting the challenges facing Canadian manufacturers,” it added.

The Ford deal contains no increases to base wages and pension plans will remain the same for existing employees. Each worker will get $2,000 a year in the second, third and fourth years to cover cost-of-living increases, and a $3,000 ratification bonus.

New hires will make 60 per cent of full pay, which would be reached after 10 years — rather than after six years as in the last collective agreement. New hires will also be signed up for a hybrid pension plan, rather than a defined benefit plan for current workers.

The Ford deal will also give 800 laid off employees a chance to get back to work, partially through the creation of 600 new jobs at its Canadian operations. Most of the those positions will be at Ford’s assembly plant its Oakville, Ont.

All of the Detroit big three companies were equally aggressive on asking for concessions originally, but Ford was the first to come around.

The last strike by the CAW — which represents nearly 21,000 members at the big three automakers’ plants in Ontario — was in 1996 against General Motors.

Ford has said hourly wages for CAW assemblers are around $34 an hour, while assemblers in the U.S. are paid about $28 per hour. The company said all-in labour costs, which include pensions and health care, are approximately $79 per hour in Canada, versus $64 per hour in the U.S.

The strong Canadian dollar is also eroding competitiveness.

Ontario has seen the U.S.-based car makers cut thousands of jobs in the last decade as their parent companies restructured in the United States.

General Motors and its Canadian subsidiary were nearly felled by the economic downturn in 2009, which compounded years of losses at the automaker.

It survived by filing for bankruptcy protection in the United States and restructuring its operations with the help of billions of dollars in aid from governments both in Canada and the United States.

Ottawa took an eight per cent stake in the automaker and Ontario took another four per cent after they together lent it C$10.5 billion.

CAW says it expects to see a new proposal from General Motors soon

By The Canadian Press - Tuesday, September 18, 2012 at 7:07 PM - 0 Comments

TORONTO – The head of the Canadian Auto Workers union says he is optimistic after a day of constructive talks with General Motors that the union can soon reach a new collective agreement with the company.

CAW president Ken Lewenza says he anticipates seeing a new proposal shortly from GM Canada after spending the day discussing details of the deal previously hammered out with Ford.

Lewenza says discussions with GM are more advanced than the talks underway with Chrysler, which is still reviewing the costs of agreeing to a deal similar to that inked with Ford.

Still, he adds there is a feeling of optimism in discussions with Chrysler.

Lewenza says the discussions with the automakers will continue around the clock.

The union cancelled a Monday night strike deadline, agreeing to give Chrysler and GM negotiators more time to go over the tentative four-year deal it reached with Ford on Monday.

CAW extends talks with GM, Chrysler, putting off strike

By macleans.ca - Tuesday, September 18, 2012 at 9:28 AM - 0 Comments

TORONTO – Members of the Canadian Auto Workers union are still on the job as negotiators try to hammer out new contracts with Chrysler and General Motors.

The union cancelled a Monday night strike deadline, agreeing to give Chrysler and GM negotiators more time to go over the tentative four-year deal it reached with Ford on Monday.

“We think it makes common sense that we give both Chrysler and General Motors the opportunity to do their due diligence on the collective agreement we established at Ford,” CAW president Ken Lewenza said.

“If we’re making progress, the facts of the matter, if it takes us a day or two or even three days, we will do it.”

The union said the Ford deal sets a pattern it expects the other companies to match.

Lewenza called the union’s move a good faith gesture — but adds that good faith must lead to good results.

A strike is still possible and Lewenza says the union will give 24-hours notice of a walkout if Chrysler and GM drag their feet on a deal.

General Motors said Monday night that it was looking forward to “continuing with the constructive dialogue.”

Chrysler would not comment beyond saying it was reviewing the tentative agreement with Ford.

The Ford deal will give 800 laid off employees a chance to get back to work, partially through the creation of 600 new jobs at its Canadian operations.

Most of the new positions will be at its Oakville, Ontario assembly plant.

There are no base wage increases in the Ford deal.

But each worker will get $2,000 a year in the second, third and fourth years to cover cost of living increases, and a $3,000 ratification bonus.

CAW extends talks with GM, Chrysler

By The Canadian Press - Tuesday, September 18, 2012 at 4:22 AM - 0 Comments

TORONTO – The Canadian Auto Workers union struck a tentative four-year deal with Ford on Monday and extended talks with General Motors and Chrysler, putting off a threatened strike as a midnight deadline loomed.

“It’s a damn good deal in these economic times,” CAW president Ken Lewenza said of the Ford deal. “It is a damn good deal.”

The agreement will give 800 laid off Ford employees the opportunity to get back to work, partially through the creation of 600 new jobs at its Canadian operations. Most of the new positions will be at its Oakville, Ont., assembly plant in two stages of hiring, he said.

There are no base wage increases during the life of the agreement, which lasts until September 2016, but each employee will receive $2,000 a year in the second, third and fourth years of the contract to cover cost of living increases, and a $3,000 ratification bonus.

The union is asking Chrysler and GM to accept the deal as a pattern settlement.

Talks with the two automakers continued Monday, with the union announcing just before 9 p.m. ET that all sides agreed to continue talking — putting off the threatened midnight strike.

The union said it would keep talking with Chrysler and GM as long as progress is being made, but warned that any time it feels talks have stalled it will issue a 24-hour strike notice.

“We think it makes common sense that we give both Chrysler and General Motors the opportunity to do their due diligence on the collective agreement we established at Ford,” Lewenza said.

“If we’re making progress, the facts of the matter, if it takes us a day or two or even three days, we will do it.”

Lewenza called the continued talks a “good faith gesture.”

“But good faith must result in good results. At the end of the day we’re hopeful we’ll get a deal, we’re optimistic we’ll get a deal.”

After the tentative deal was inked with Ford on Monday afternoon, Lewenza had said the gap between the union and the two remaining companies was wide. They were still far apart Monday night, Lewenza said, but they went back to the table after the press conference.

“We are optimistic that if you have a willing partner you can get the job done,” he said. “So if General Motors and Chrysler is listening, let’s dance. Let’s get the job done.”

General Motors said Monday night that it was looking forward to “continuing with the constructive dialogue.”

Chrysler would not comment beyond saying it was reviewing the tentative agreement with Ford.

Lewenza said pattern bargaining — in which a deal is reached with one company that forms the basis for agreements at the others — is necessary because it removes wages from the number of competitive pressures the companies face.

He said even Honda and Toyota employees, who are not unionized, are closely watching what happens with the CAW for direction on their expectations.

All of the Detroit big three companies were equally aggressive on asking for concessions originally, but Ford was the first to come around, Lewenza said, adding the union plans to stand its ground on the deal reached with Ford.

“We cannot with good conscience compromise the pattern that (Ford) established because frankly it gives them a competitive disadvantage and we will not do that,” he said.

A Ford Canada spokeswoman said Monday that the agreement covering about 4,500 employees will help the company remain competitive, but declined to provide additional details as the deal still has to be ratified by CAW members.

“We believe that the tentative agreement offers unique-to-Canada solutions that will improve the competitiveness of the Canadian operations while providing employees the opportunity to earn a good living,” said Lauren More.

A union proposal to lower wages for new hires — who will make 60 per cent of full pay — but allow them to reach full pay after working for 10 years, is part of the deal. The union agreed to extend the wage progression scale from six years, Lewenza said Monday.

“The fact of the matter is we’ve always had a wage progression and now we have to extend it to win investment,” he said.

There’s no change to pensions for active members, but new hires will be under a defined hybrid plan, which sees a contribution from the employees and a guaranteed contribution from the employer, Lewenza said.

It’s hoped that ratification votes will happen this weekend, he said.

Chrysler earlier responded to the CAW’s move to focus on Ford by saying they were “very concerned” that Ford wasn’t in the best position to lead negotiations because it has reduced its footprint in Canada in recent years.

Ford has the least to lose from an unfavourable contract, so reaching a deal with them first could be bad news for the other automakers, said auto analyst Tony Faria.

Ford might have agreed to the deal because with about four per cent of their global assembly in Canada — versus about nine per cent for GM and about 20 per cent for Chrysler — it’s easier on them just to avoid a strike, he said.

“It does not bode well for the future of the auto industry in Canada whatsoever,” said Faria, a University of Windsor professor.

“We need to have a deal that gets CAW labour costs more in line with the labour costs at (United Auto Workers) plants in the U.S. That’s the only way we’re going to see future investment and job creation among the Detroit companies in Canada.”

Ford has said hourly wages for CAW assemblers are around $34 an hour, while assemblers in the U.S. are paid about $28 per hour. The company said all-in labour costs, which include pensions and health care, are approximately $79 per hour in Canada, versus $64 per hour in the U.S.

The agreement with Ford could cause GM and Chrysler to re-evaluate their presence in Canada, said auto industry analyst Dennis DesRosiers.

“If it suits both GM and Chrysler they will accept (the Ford deal) and move on. If it doesn’t they also will accept it, but that calls in to question where they want to be in Canada in the medium-to-long term,” he said.

“Not that they would move a plant today, but these plants all have relatively short lifespans and I don’t think any of them would pull back on closing a plant in Canada.”

The big three are making it clear that they will shift production to where labour costs are lower, Faria said.

“The companies are already showing their hands,” he said.

“Ford closed their St. Thomas, Ont., plant last year. At the same time they were investing in plants in the U.S., adding third shifts and adding jobs.”

General Motors is shutting down its consolidated plant in Oshawa, Ont., next year, a move that will eliminate 2,000 direct jobs. Meanwhile, it is restarting production at the former Saturn assembly plant in Spring Hill, Tenn.

The strong Canadian dollar is also eroding competitiveness.

Ontario has seen the U.S.-based car makers cut thousands of jobs in the last decade as their parent companies restructured in the United States.

Premier Dalton McGuinty said Monday he’s confident that everyone involved knows what’s at stake.

“With respect to any agreement that we might have entered into with our auto sector partners we have every confidence that they will honour those agreements,” McGuinty said.

During the financial crisis, the federal and Ontario governments helped bail out Chrysler and GM with a rescue package that totalled about $13 billion, with the majority — $10.5 billion — going to GM.

The automakers entered the bargaining round seeking a permanent wage reduction for fresh employees, similar to a deal the companies reached in the U.S. But the CAW has been adamant it will never agree to a pay structure that creates “two tiers” of employees.

The last CAW strike was in 1996, against General Motors.

CAW reaches deal with Ford

By The Canadian Press - Monday, September 17, 2012 at 4:12 PM - 0 Comments

TORONTO – The Canadian Auto Workers union says it has reached a tentative four-year deal with Ford, just hours before a midnight strike deadline.

CAW president Ken Lewenza says they will ask Chrysler and GM to accept the deal as a pattern settlement.

Existing contracts at the three big automakers expire at one minute before midnight tonight and the union has previously said it’s prepared to strike then if necessary.

The CAW had been focusing its energies on Ford over the past few days, suggesting Ford wasn’t dead set against lowering wages for new hires but allowing them to reach full pay over time.

Chrysler responded to the move by saying they were “very concerned” that Ford isn’t in the best position to lead negotiations because it has reduced its footprint in Canada in recent years.

Auto analyst Tony Faria says Ford has the least to lose from a contract that’s unfavourable to them, so reaching a deal with them first could be bad news for the other automakers.

CAW close to deal with Ford, Lewenza says

By The Canadian Press - Monday, September 17, 2012 at 2:41 PM - 0 Comments

TORONTO – The Canadian Auto Workers and Ford are close to reaching a tentative deal, the head of the union said hours ahead of a strike deadline.

Ken Lewenza said an agreement with Ford is nearly finalized, and once it’s done the union will take it to Chrysler and GM to see if they will match it.

Contracts at the three big automakers expire at one minute before midnight tonight and the union has previously said it’s prepared to strike then if necessary.

The union will hold a press conference at 4 p.m. ET today to provide an update on the talks.

The CAW has been focusing its energies on Ford over the past few days, and Lewenza has suggested Ford wasn’t dead set against a union proposal to lower wages for new hires but allow them to reach full pay over time.

Chrysler responded to the move by saying they were “very concerned” that Ford isn’t in the best position to lead negotiations because it has reduced its footprint in Canada in recent years.

Ford has the least to lose from an unfavourable contract, so reaching a deal with them first could be bad news for the other automakers, said auto analyst Tony Faria.

Ford might agree to a deal retaining relatively high labour costs because with about four per cent of their global assembly in Canada — versus about nine per cent for GM and about 20 per cent for Chrysler — it’s easier on them just to avoid a strike, he said.

“We need to have a deal that gets CAW labour costs more in line with the labour costs at (United Auto Workers) plants in the U.S.,” said Faria, a University of Windsor professor.

“That’s the only way we’re going to see future investment and job creation among the Detroit companies in Canada.”

The automakers are looking to pare costs labour costs in Canada, which they say are higher than in the United States.

Ford has said hourly wages for CAW assemblers are around $34 an hour, while assemblers in the U.S. are paid about $28 per hour. The company said all-in labour costs, which include pensions and health care, are approximately $79 per hour in Canada, versus $64 per hour in the U.S.

The strong Canadian dollar is also eroding competitiveness.

Ontario has seen the U.S. car makers cut thousands of jobs in the last decade as their parent companies restructured in the United States.

Premier Dalton McGuinty said Monday he’s confident that everyone involved knows what’s at stake.

“With respect to any agreement that we might have entered into with our auto sector partners we have every confidence that they will honour those agreements,” McGuinty said.

During the financial crisis, the federal and Ontario governments helped bailout Chrysler and GM with a rescue package that totalled about $13 billion, with the majority — $10.5 billion — going to GM.

Lewenza has said the union would ignore its 11:59 p.m. ET deadline if a breakthrough was close.

“If we see light at the end of the tunnel then we’re going to keep working until it shines on an agreement,” he said.

But he said if that tunnel ends with a brick wall then the CAW will put its nearly 21,000 members on strike at one or all of the automakers’ plants.

“That is the last tool in the bargaining toolbox,” he said.

The automakers entered the bargaining round seeking a permanent wage reduction for fresh employees, similar to a deal the companies reached in the U.S.

But the CAW has been adamant it will never agree to a pay structure that creates “two tiers” of employees.

The last CAW strike was in 1996, against General Motors.