Canadian auto workers ratify 3-year Ford contract

By ROB GILLIES
Associated Press Writer

The Canadian Auto Workers voted to ratify a three-year contract with Ford Motor Co., an agreement the union expects Chrysler LLC and General Motors Corp. to match.

Union spokeswoman Shannon Devine said the membership voted 78 percent in favor late Sunday. About 9,000 CAW workers work for Ford in Canada.

The surprise deal, reached months before the CAW´s national auto contracts expire in September, keeps Ford´s labor costs essentially the same as they are now, the union said.

The deal freezes wages and cuts vacation pay but avoids changes to base wages, the union said. It also prevents a two-tier wage system used in the U.S. in a contract with the United Auto Workers, where new hires would be paid about half the hourly wages of older employees. New hires would start work at 70 percent of the top wage, reaching the maximum three years later.

Canadian Auto Workers President Buzz Hargrove called Sunday´s tally an "overwhelming vote of support."

"That´s an endorsement of the union and the strategy to move early," said Hargrove, who added the Ford deal will be the pattern for the others.

Negotiations with GM start Monday and talks with Chrysler begin Tuesday.

"They will accept the same economic terms. It´s only a question of when," Hargrove said in an interview. "I´m hoping it will be in the next week or so."

Both GM and Chrysler have said they´ve been analyzing the Ford deal.

The CAW said Ford´s total labor costs for active production workers will stay around $67 per hour, about $7 per hour more than the UAW. The CAW said the difference is wiped out by higher productivity at Canadian plants.

CAW workers make the strong-selling Ford Edge and Lincoln MKX crossover vehicles at a plant in Oakville, Ontario, near Toronto. The same plant is scheduled to build the Flex large crossover later this year.

"This agreement is the right solution for the Canadian marketplace. The terms recognize the importance of our employees´ contributions and improves the competitiveness of the Canadian operations," Stacey Allerton Firth, vice president, human resources, Ford of Canada said in a statement.

Canadian auto analyst Dennis DesRosiers has said the agreement with Ford will be a disappointment for GM and Chrysler, who are looking for savings.

Canada´s auto industry long had an advantage over the U.S. industry because Canada has free health care and the Canadian dollar was weak, but those advantages no longer exist as Canada´s dollar is almost on par with the greenback and the U.S. auto industry now has fewer health care costs because of recent agreements.