GM Canada Sees Advantage In Starting Contract Talks With Canadian Auto Union

Autoparts Report, May 22, 2002

General Motors of Canada Ltd. said it wants to be the first to start contract talks with the Canadian Auto Workers union later this year. The first company to settle with the CAW, the target company as the union call it, traditionally wins a competitive advantage by setting the pattern for contract negotiations with the other two automakers.

"We've indicated that at General Motors right now, we're setting the pace in the marketplace in terms of sales activities, promotions and similarly we'd like to set the pace in terms of the upcoming contract," GM Canada's president, Michael Grimaldi told Reuters.

GM, along with Ford of Canada and DaimlerChrysler, are gearing up for contract talks later this summer. Job security and higher wages will be key issues as both GM and Ford plan to close assembly plants in Canada and lay off thousands of workers, the companies said. The union said it will start talking to all three in the summer and will pick its target by early September. A strike could ensue if no settlement is reached with the target.

By becoming the first company in talks, GM said it hopes it will be better able to tailor the contract to what it wants, rather than being forced into a pattern set by one of its rivals.

GM Canada is on pace for a record year in terms of sales. Last year it sold 470,000 cars and trucks in Canada -- for a 29.4 percent share of the market -- and is already 12 to 13 percent ahead of its sales targets this year, the company said. It is also on pace to meet or beat its production total of 831,000 cars and trucks in 2001 -- many of which are exported to the United States, it added.