The labour strike at General Motors Co.in the US could lead to thousands of layoffs in Canada as the ripple effects from the highly integrated auto industry spread from engine plants to parts makers such as Magna International Inc.
The letter from UAW Vice President Terry Dittes (DIT-ez) to GM's chief bargainer says the company waited to make the offer until two hours before the contract expired Friday night. But the union said GM's proposal fell short in key areas including health care, use of temporary workers and the length of time it takes for shorter-tenured members to get to top-scale pay. During the walkout, UAW members will get $250 a week from the union's strike fund.
The walkout will be just the second national work stoppage at GM since a 67-day strike in 1970. The strike could cost GM about US$50 million a day in earnings before interest and taxes due to lost production, Dan Levy, an analyst at Credit Suisse, said Sunday.
Early Monday, workers shut down 33 manufacturing plants in nine states across the USA, as well as 22 parts distribution warehouses. Trump and Democrats see the votes of UAW members in the Midwest as critical to victory. On Sunday, he sent a tweet calling for the carmaker and union to "make a deal". Those engines are shipped to about 10 different GM assembly plants across North America. The state is pivotal to Trump's re-election. GM's offer "still doesn't address some of the union's demands".
"Canadian workers and American autoworkers feel the exact same way".
Before the talks broke off, GM offered new products to replace work at two of four US factories that it intends to close.
In a statement Sunday, GM outlined its offer to the union, saying the package included solutions for the MI and OH assembly plants now lacking products, $7 billion in US investment and a signing bonus of $8,000 per worker. The new factory would be in addition to a proposal to make electric vehicles for a company called Workhorse, the person said. The automaker has offered a number of Lordstown workers transfers to other facilities.
A new battery plant could give some UAW workers at Lordstown the chance to remain with GM. "Business is good, so if you're the UAW, this is a good time to strike", Jominy said.
A strike "may very well" sprout at Canadian plants in 2020, he said. GM Canada has about 5,700 hourly employees at three manufacturing plants in Ontario.
GM's workers last went out on a brief two-day strike in 2007 during contract talks. Two of GM Canada's plants - Oshawa and St. Catharines - rely on parts from the US and could see jobs being hit as early as this week, said Jerry Dias, national president for Unifor, the Canadian union.
Democratic presidential candidates weighed in to back the union, including Senators Bernie Sanders and Kamala Harris, former Vice President Joe Biden and Representative Tim Ryan.
In the letter released by the union Monday, Dittes wrote that there are many important items left in the talks including wage increases, pay for new hires, job security, profit sharing and treatment of temporary workers.
The strike will test both the union and GM at a time when the USA auto industry is facing slowing sales and rising costs associated with launching electric vehicles and curbing emissions.
"We are concerned with the potential impact the labour strike at General Motors in the U.S. may have on the company's operations in Ontario along with our integrated supply chain that delivers parts to GM's facilities in the U.S.", Fedeli said in a statement.
As of September 1, the automaker had 96 days supply of its Chevrolet Silverado pickup truck, 59 days supply of its Chevrolet Equinox SUV and more than 100 days supply of the Cadillac Escalade. The automaker now has about one-tenth the number of union-represented USA employees.