TORONTO, Sept. 17 — General Motors and the Canadian Auto Workers union agreed tonight on a new three-year contract covering 19,000 workers in Canada, just five hours before a strike deadline set by the union.þþThe agreement includes wage increases of 3 percent in each of the first two years and a 2 percent rise in the third, plus a signing bonus of 1,000 Canadian dollars ($632). It also offers 28 additional hours of paid vacation each year and other improved fringe benefits. In addition, G.M. has agreed to invest 800 million Canadian dollars ($506 million) in its Canadian plants, including a line to produce a new full-size truck model.þþThe deal still requires ratification by the union members, who will vote over the weekend.þþBuzz Hargrove, president of the union, said the agreement met the ÿconcerns and needsÿ of the union's members and also allowed G.M. ÿto thrive and grow.ÿþþMichael Grimaldi, president of General Motors Canada, said he was pleased to have an agreement reached without a strike. He said the deal would allow G.M. ÿto continue to look for opportunities to improve productivity and quality performance.ÿþþFollowing past practice, the G.M. contract will be used as a pattern for the union's negotiations in coming weeks with the Canadian units of the Ford Motor Company and DaimlerChrysler A.G.þþFor the first time, bargaining is not taking place simultaneously in the United States and Canada. The companies' American plants are covered by a four-year agreement with the United Automobile Workers, which expires next year.þþThe American and Canadian operations of the three companies are closely integrated, with assembly lines in each country producing parts and vehicles for the entire North American market. A strike in Canada would reverberate at many vehicle and parts plants in the United States.þþThe talks with Ford and DaimlerChrysler are expected to be more protracted than those with G.M. because of their financial conditions. ÿFord will be the most difficult of all the negotiations we have in front of us,ÿ Mr. Hargrove said today.þþThe union chose G.M. for the initial negotiations because of its relatively sturdy financial position and because the company had already put in place many of the job-security provisions the union was seeking.þþG.M. added a shift earlier this year at its flagship plant in Oshawa, east of Toronto, to step up output of the Chevrolet Impala. It has also announced plans to invest 300 million Canadian dollars ($190 million) in the Oshawa plant to produce a new midsize Pontiac.þþBy contrast, Ford and DaimlerChrysler have both announced plans to close assembly plants in Canada, with significant job losses. The union has made job security a top priority in the current round of talks.þþFord's plan to close its pickup truck assembly line at Oakville, Ontario, next year has fueled tensions between the Canadian union and the U.A.W. The plant is working only one shift, and the Canadian union has urged Ford to add a second shift, at the expense, if necessary, of one of its American plants.þþG.M.'s flagship Canadian plants at Oshawa assemble the Chevrolet Impala and Monte Carlo and the Buick Regal and Century. A truck plant at Oshawa produces the full-size Chevrolet Silverado and the GMC Sierra pickup. A plant at St. Catharines, Ontario, makes engines and components. Transmissions are produced in Windsor, Ontario.þþThe contract talks also covered workers at G.M. plants in London, Ontario, that make locomotives and light-armored vehicles.þþUnder the existing contract, the base wage for assembly line workers at G.M. is 27.70 Canadian dollars ($17.52) an hour, and 33.10 Canadian dollars ($20.93) for electricians, mechanics and other trades.þþLast Friday, Mr. Hargrove described G.M.'s initial offer as the ÿworst first offer we've ever received.ÿ The company proposed, among other things, lump-sum payments instead of wage increases in the second and third years of the contract and hiring contract workers rather than permanent ones at the Oshawa plant.þþThe auto industry has broken sales records in both the United States and Canada in recent months with the help of generous discounts and interest-free financing deals. In the United States, August sales were running at an annual rate of 18.7 million vehicles, up 13.5 percent from the August last year.þþGeneral Motors' sales in Canada rose by 13.4 percent in August, far ahead of Ford's 2.9 percent increase, and DaimlerChrysler's 2.3 percent advance.þþThe Big Three have, however, continued to lose ground against imports.þþþþ
Source: NY Times
