By on February 11, 2013

CAW members at GM’s CAMI plant in Ontario have voted to begin negotiating their contracts as early as this week  after a vote by workers. At stake is the production of the GMC Terrain and Chevrolet Equinox, two popular crossovers that may have their production moved to Mexico or the United States.

The Theta crossovers, as their known internally, are hot sellers for GM. CAMI is working beyond capacity, and overflow production is currently being sent to the former Saturn site in Tennessee that has been rumored as a possible full-time production facility. The CAW will reportedly seek a deal that is similar to the pattern agreement reached with workers at GM’s Oshawa plants this past summer. GM officials previously hinted that an early contract negotiation and agreement would significantly bolster the Theta crossovers chances of staying in Ontario, rather than moving them to locations with lower labor costs like Mexico or Tennessee.

Another issue in play is whether GM could even do so without violating a key bailout condition. GM is required to keep at least 16 percent of its production in Canada as part of its Canadian bailout package. Having already partially moved the next-generation Impala to Michigan, GM may be in danger of falling below the threshold if Theta production were to go as well (and no replacement product was found).

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15 Comments on “CAW Opens Up CAMI Contract, Horse Trading Begins For Theta Crossovers...”


  • avatar
    28-Cars-Later

    I would think the smart move would be to migrate your hot selling items to a cheaper manufacturing location in order to maximize profit. Since we can’t be certain what the consequences of breaking the 16% agreement are because “no government officials would divulge the penalties or mechanisms in place to ensure that GM complies” its difficult to predict GM’s longer term intentions toward Canada. I would think any relocation is going to be a case of which side blinks first, after all the savings of relocation may outweigh the bailout penalties. GM might be thinking, “Go ahead, make my day”.

    • 0 avatar
      -Cole-

      “the smart move would be to migrate your hot selling items to a cheaper manufacturing location”

      Always a consideration

    • 0 avatar
      wmba

      “Whichever side blinks first”. Well, our PM doesn’t blink well, and he has a contract and 9% of GM shares to back him up. He hates to lose, because it wouldn’t look good in his autobiography.

      On the other hand, he hates unions, so the CAW braintrust can leap up and down, do the two-step, proclaim solidarity and brotherhood, drag their tame economist on TV to make broad left-wing statements, all for nothing if they piss him off by demanding too much pay.

      It’ll be interesting, but it’ll be whatever Harper wants, not Akerson.

      • 0 avatar
        28-Cars-Later

        Great insight, it also struck me last summer while traveling GM (esp Pontiac) seems to have quite a following in Toronto and thereabouts up the QEW. If GM initiated a policy of slowly relocating production would this have a big impact on Canadian car purchases?

      • 0 avatar
        danio3834

        @28cars “If GM initiated a policy of slowly relocating production would this have a big impact on Canadian car purchases?”

        I would imagine so to some degree. Of the Detroit 3, Chrysler has the largest share of their manufacturing in Canada. In January and for a good chunk of 2012, Chrysler was the number one seller of vehicles in Canada.

        Chrysler has been flip flopping back and forth with Ford for that title, which now only maintains one assembly plant in Canada, but several engine plants.

      • 0 avatar
        28-Cars-Later

        Ford was wise to keep several engine plants open in Canada, then even if the final assembly plant is shuttered no one can point and say Ford isn’t committed to Canada/CAW/etc. I’d imagine the additional cost of building the engines there vs Mexico/USA is minimal compared to the additional costs of total assembly vs Mexico/USA.

        I also see Chrysler as a winner here because the more the other two pull out, the more leverage Chrysler has with CAW/CA govt, unless CAW is also in other auto mfgs (which I doubt).

        Should be interesting to see how Canadians react to any further plant closures/relocations. Americans have already in the past shown their lack of US brand loyalty/patriotism, I wonder if Canadians will do the same.

    • 0 avatar
      Pig_Iron

      I suspect the end game is to close the near 100 year old facility in Oshawa. I think that its product is gradually being moved out. CAMI is is a revatively moderm flexible facility, so I also think that the GM brass hats are looking for a good deal, that provides long term stability. Also, the union local of CAMI is not know for being militant, unlike the other vehicle assembly location.

      • 0 avatar

        100 years old or not, it’s one of the best facilities they have

      • 0 avatar
        mikey

        Four facts I would like to point out.
        # 1….. The “Flex plant” in Oshawa is one of the most modern Auto manufactoring facilities in the world. Fully automated with much of the same equipment used by BMW,Honda,VW and Toyota. Oshawa flex can run anything from a Mini Van to a full size pick up, with minimal retooling. The 100 year old plant was knocked down 7 years ago. Today a Costco sits there.

        #2..CAMI always has,and probably always will, be under a complete different contract than Oshawa. Up to this point in time,wages and benifits have lagged 10 – 15 percent behind the rest of the CAW. Paterned,after the original Saturn Tenn. agreement. I don’t see that situation changing.

        # 3 Oshawa metal center [stamping] press some of the sheet metal,and ships to CAMI. CAMI in turn. ships back 12 finished bodies per hour to “Oshawa “car body assembly plant”.. AKA the consolidated” {Impala}. The 12 JPH are then run with the Impala and finished in Oshawa.

        # 4 Oshawa consolidated goes from two shifts, to steady days in April. Oshawa Flex goes from 2 shifts to 3 in May.

    • 0 avatar
      danio3834

      @28cars, regardless if they continue to manufacture vehicles in Canada, I suspect the Detroit 3 will still maintain a sales lead based on the massive amount of trucks sold to be used in the oil fields. The top selling cars are almost exclusively Japanese or Korean brands now, although the Detroit 3 are making gains in this area.

  • avatar

    A contract is a Contract or isn’t it? That’s the question isn’ t it?

  • avatar
    dcars

    I would bet that GM wants to keep some production in Canada, but getting a better “Deal” is always worth exploring.

  • avatar
    tuffjuff

    I just hope they keep making my Equinox in CAMI long enough for me to take my 2 week old Atlantis Blue LT on a pilgrimage to her birthplace. :’(

  • avatar
    Sooke

    Now that Indiana and Michigan are “right to work” states, I wonder if Ontario will be the first Canadian province to become “right to work”.

    It might help keep more unionized plants from closing.


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