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Chrysler LLC ratcheted up the pressure on the Canadian Auto Workers another notch Friday, saying its Canadian operations and 9,400 jobs will disappear unless the union agrees to sharply reduce benefits.
The latest salvo in the escalating campaign by the company, Ottawa and would-be Chrysler saviour Fiat SpA to convince the union to agree to benefit cuts of $19 an hour came in a letter from Chrysler chairman Bob Nardelli and vice-chairman Tom LaSorda to the company's employees.
“Let me be clear, our negotiations are about saving Chrysler Canada,” the executives wrote. “We are coming down to the wire in the fight for our company's survival – and we need your support.”
Eliminating or reducing several benefits outlined in Friday's letter would cut costs by $8.24 an hour without having an impact on base wages or pensions.
Tom LaSorda
“Without labour concessions Chrysler Canada's manufacturing operations will not survive long-term,” Chrysler president Tom LaSorda writes. (Getty Images)
Some union members responded by burning copies of the letter outside the company's minivan plant in Windsor, Ont.
“You have to ask yourself whether they're trying to find reasons to pull out of Canada and reasons to blame the union,” CAW president Ken Lewenza said.
The letter, he added, is the culmination of “an unprecedented and outrageous series of attacks on Canadian auto workers and their union.”
Mr. Lewenza reiterated his union's opposition to cutting benefits beyond the $7 an hour worth of concessions already granted to General Motors of Canada Ltd.
Ontario Liberal Premier Dalton McGuinty chimed in by urging everyone involved to “keep the temperature down” and to protect families whose livelihood depends on the auto sector.
“I'm not going to provide specific advice to the union, except to say we all have to find a way to come to the table and make some sacrifices,” he told reporters.
Mr. McGuinty, who said he prefers to do his talking at the negotiating table rather than through the media, made it clear that his government will not provide further financial assistance unless the union makes some sacrifices.
“I, as Premier, am making a big ask of Ontarians,” he said. “I can't do that, and I won't do that, unless the other parties come to the table and do something significant.”
Negotiations were scheduled to resume Monday after talks broke off late last month, but they will probably not resume until late next week because Chrysler negotiators are still in bargaining with the United Auto Workers in the United States.
That delay would give the two sides less than a week to reach a deal and have it approved by members ahead of the April 30 deadline the federal and Ontario governments set as a condition of advancing more money to Chrysler Canada. The auto maker is existing now on $750-million provided by the two governments as part of a $1-billion loan.
The disappearance of Chrysler from Canada would cause thousands of jobs cuts at suppliers and dealers, as well as wiping out the 9,400 jobs at the company's two Ontario assembly plants, in Brampton and Windsor, and an engine-parts plant in Toronto.
Parts makers Magna International Inc. and Johnson Controls Inc. each have plants dedicated solely to making seats for Chrysler vehicles and several other Magna plants assemble parts that are shipped to the two Chrysler assembly plants.
Chrysler wants to eliminate out-of-province medical care, semi-private hospital room coverage, child care, legal services, extended health care coverage and life insurance.
Shift premiums would be reduced and health care premiums increased.
“That was the list they provided us at the bargaining table and that was the list we rejected outright,” Mr. Lewenza said.
Two weeks left.
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