By on March 28, 2009

The following email just came over the TTAC transom. Negotiations between Chrysler and the Canadian Auto Workers have broken down three days ahead of Canada’s bailout deadline and Uncle Sam’s defunct deadline for union concessions. Chrysler has already threatened to pull out of Canada. Given this stalemate, and the Presidential Task Force on Automobile’s determination to keep the zombie automaker in business, they just might.

Chrysler LLC Statement Regarding CAW Talks Attributed to Al Iacobelli, Chief Bargainer:

“We all recognize that we are in unprecedented times as it relates to the global economy and current financial crisis, which has a direct impact on the automotive industry. After several days of bargaining in good faith, Chrysler and the CAW have not reached an agreement that closes the competitive gap with other automobile manufacturers in Canada, to ensure Chrysler’s immediate viability.

The Company has been very clear in its Canadian Government testimony and position with the CAW: we must ‘close the competitive gap’ of $19 an hour immediately, with a goal of not having to affect base wages and pensions; while contributing to Chrysler’s viability with direct annual savings to the bottom-line in the current year, and each of the remaining years of the contract.

Although we made progress toward ‘closing the gap’, significant issues related to the existing ‘pattern’ remain on the table. These are not normal business circumstances and all Chrysler constituents have been asked to ‘break pattern’ – employees, retirees, dealers, suppliers and others. These requests have been made to all of our constituents, including the CAW, to ensure Chrysler’s viability.

We continue to engage with the CAW to resolve these issues in a responsible manner.”

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46 Comments on “Wild Ass Rumor of the Day: Chrysler Preparing for Canadian Pullout?...”


  • avatar
    AdamYYZ

    Get out.

    The more time that goes by the more I don’t like this company. Holding the Canadian government and its hard working citizens ransom is unacceptable. I’m from Brampton, so this affects me too, but I get the feeling they are going to threaten to pull out every time they don’t get what they want.

    I wish they would just pay their taxes and make a fair settlement to their employees. If they can’t do that, than maybe we are better off WITHOUT THEM.

    I’m tired of getting stuck behind car carriers loaded with 300’s and chargers anyway.

  • avatar
    Gardiner Westbound

    Chrysler’s Tom LaSorda earlier told a parliamentary committee it will pull out of Canada unless it receives substantial CAW concessions, later defined as a genuine $19/hour pay reduction. Creative CAW’s accounting somehow equates the $7 GM reduction as the equivalent of $19.

    Buzz Hargrove, in the red shirt, retired as CAW union boss in September 2008. Ken Lewenza, who may not be the brightest light on the tree but has a sort of animal cunning, replaced him.

    The CAW is calling Chrysler’s bluff. Friday afternoon Hargrove said there no way Chrysler will abandon Canada. The Canadian plants are the only ones that make money and it will cost a billion dollars, which Chrysler doesn’t have, and take months to relocate production. Lewenza says Chrysler Canada’s 200,000 annual sales will plunge to zero if it pulls out.

    The Canadian government has an $800-million tax lien on the Brampton plant. That equipment isn’t going anywhere any time soon.

  • avatar
    dan

    I hope the CAW does not sell out it`s membership but it seems that the CAW will do just that. Ken has said that twice they had a deal and then the deal was pulled. This leave one to believe that Chrysler got what they wanted and then asked for MORE and the sellout CAW GAVE them MORE. When Chrysler seen how much the CAW was selling the workers out they pulled out for a second time and is now asking for MORE. Will the SELLOUT CAW give even more. CAW = SELLOUT . Glad I am in a REAL UNION

  • avatar
    mikey

    The table has turned, literally.For many years the it was the union telling,the company”give
    us what we want or we will shut the plant down”
    The union sqweezeed every dime they could and it worked.Now the shoe is on the other foot.

    Lewenza is an unknown quantity.Has he got Buzz Hargrove’s smarts?Or Bob White’s balls?For the uninformed, Bob White took on GM and then the UAW
    and won.The CAW would not exsist if it were not for Bob White.You could love or hate him,but he had brass ones.

    My guess, Lasorda will blink.Tom is a good man I remember him as young foreman at GM.His daddy was president of the Chrysler local in Windsor.He knows his way around the blue collars.He also knows that Ontario and Canada are holding a lot of markers on Chrysler.

    Your gonn’a see a tentative agreement,no later than Sunday night.

    Mikey know these things

  • avatar
    DweezilSFV

    Mikey: you are one of the most objective union posters I have read on this and other sites.

    How did you manage to stay so rational? There is really an either /or slant, rabid hatred for the union or unhinged defenders of them with no in between where people can tell what is actually going on. I think you do know, just from being rational.

    Guess we’ll have the answer Monday a.m. eh?

  • avatar
    mikey

    Thanks DweezilSFV.Your giving me too much credit.
    It’s just years of the company and the union feeding me B.S.

  • avatar
    MikeInCanada

    Mikey is right. The pressure is off on all sides now that the US is coughing up more money – and I just can’t help but think that the Canadian Federal Gov’t has been making lot’s a call to both sides saying “Please, just agree to something…anything…we just need political coverage to give you the cash”

  • avatar
    mikey

    Right! MikeInCanada, Lewenza is aware that the Canadian bailout is conditional to Uncle Sam writing a check.Chrysler will eat the GM agreement,one way or the other.What are they gonn’a do?They ain’t gonn’a run to the US govt,saying”we pissed of the Canadians,can you give us more cash”.Sorry Mr President but not only
    are the Canucks not giving us any money,now they want the 800 million in taxes we owe them.

    Not gonn’a happen

  • avatar
    Neb

    Even though I have family that might be affected, I wish Chrysler would pull out. There’s no future for Chrysler anyway. Even if they manage to survive, thier stated plan ios to become a manufacturer like Dell, a reseller of other people’s manufacturing. It’s not like those auto plants will remain in Canada under that plan, not with the Chinese becoming increasingly desperate.

  • avatar
    dougjp

    Chrysler, get out. We’d rather deal with the large problem that creates NOW rather than later when our money has been wasted plus the problem is bigger.

  • avatar
    Bimmer

    Let them pull out, then not only Canadian government will want their back owned taxes but also VW gonna sue them for delaying production of their Routan. How well does it sell anyway?

  • avatar
    derm81

    I was under the impression that Chrysler sold a ton of vehicles in Canada. How will this affect their sales?

  • avatar
    menno

    Chrysler LLC is #1 in Canadian vehicle sales right now. Pull out of Canada, Chrysler, and see how many Canadians will want Jeeps, Chryslers or Dodges.

    Plus, as mentioned, there’s the small matter of tax liens on the profitable ex-AMC plant at Bramalea.

    If Chrysler thinks the Canadian Courts and police will argue for Chrysler if the CAW bars the plant and prevents the machinery from being moved out, I suspect they’ll find out what it’s like to have 100% opposition from every quarter.

    Perhaps the Canadian government should simply declare the plant machinery a flight risk and demand their $800 million NOW or seize the machinery for sale to the highest bidder. Along with the plants including Windsor.

    Chrysler thinks they can play hardball against a sovereign government and win?

    They either think they have the power of the Prez behind them and they’re therefore delusional (since he is NOT Prez of Canada), or they’re simply delusional.

    Wonder who’ll win Chrysler’s share of car sales in Canada?

    My guesses? Ford, Toyota, Honda, GM, Hyundai – in that order.

  • avatar
    menno

    I wish I could find my book (I’ve reorganized the house after a son moved out – can’t find a thing) about the history of Packard.

    There was a Studebaker-Packard Corporation board meeting to ‘formalize’ what had already been decided behind closed doors (i.e. illegally, ahead of time).

    The subject was that of trying to save the corporation from total ruination, in mid-1956, at a time when the company was ready to fold up and blow away like a dead leaf in early winter.

    Studebaker’s South Bend Main plant had an unreachable break-even point which hadn’t been met for over 1/2 a decade; i.e. it was not profitable. It had a recalcatrant local UAW union with a bad reputation. The cars, just restyled at great expense 8 months prior, were not selling. The six cylinder engine was hopelessly underpowered. There was also a highly modern, smaller plant on Chippewa Avenue, South Bend, which had been converted to add Hawk car production alongside pickup truck production.

    In Detroit, the Packard plant was still operating, had just had a brand new V8 engine and engine plant start production less than two years prior in Utica, Michigan, had a modernized ex-Briggs Body plant for production at which – finally – the bugs had been largely worked out and productivity was becoming acceptable.

    The plan was to close Packard’s operations. One board member, Mr. ZurSchmede, interrupted proceedings by saying “why (close) Packard?” (His response was dead silence then to be ignored).

    His point was surely that it’d be more logical to close down South Bend Main, concentrate Studebaker production at Chippewa, use Packard’s more powerful, bigger, Detroit built “six” (still in production for White truck) and more fashionably powerful, larger, newer V8’s (built in Utica).

    Nope. Management killed Packard, keeping the leech alive instead.

    Why have I brought up old, dead car companies?

    Chrysler is in the position of Studebaker’s South Bend Main plant.

    It’s a leech, not on Packard’s dowry, but on the public purse. The leadership is as poor, inadequate, inept, corrupted and rudderless as was Studebaker’s (who’d lied to Packard executives about their break-even point prior to the merger).

    Chrysler should simply be allowed to die. The monies B.O. would waste on it should instead by handed to the workforce and the workforce of the supplier plants who are losing their jobs.

    In the long run, it’d be less painful for everyone.

    As for Studebaker-Packard, do I think the company would have survived had ZurSchmede been heeded?

    Yes. IF the corporate President had done two things; gone back to the bankers and insurance companies which had confirmed $25 million for all-new 1957 cars then changed their minds and said “we are suing you for breach of promise unless you lend us the money – but here is how we are going to make money; build all shared body cars in Detroit; Hawks, pickups and rump production Studebaker cars at Chippewa and Hamilton Ontario; and retain only Packard engine plants; military trucks at Mishawaka. We’re entirely closing South Bend Main, permanently. It’ll work; we’ll be building our own bodies for everything except Hawks and Budd has that contract.”

    The bankers would have folded like a house of cards, because even President Eisenhower did not want S-P to fold up. He had too much respect for the Packard aero engines, PT boat engines, Studebaker 2 1/2 ton trucks and Weasel amphibians which helped him win the big war, for one thing.

  • avatar
    dougjp

    VERY interesting history, menno. Not sure its the same thing though, as in the current day’s situation, there’s not enough good for an alternative plan.

  • avatar
    menno

    Sorry, the second thing the S-P Prez would have needed to do (I can’t seem to get edit to work) would have been to simply come right out in public and “out” the fact that the bankers & insurance companies had made concrete promises to provide a line of credit for the $25 million to retool cars, then pulled the plug even though Studebaker-Packard had a plan to become profitable within a year, but only if the new cars were put into production.

    The all-new cars were, by the way, as “low, long and wide” – and as stylish (in the late 1950’s mode – fins) as were the highly successful Chrysler products, also introduced for 1957, which took the industry (and GM) by storm.

    In fact, these products so shook up GM (wow, that made a change) that GM literally threw away their 1958 cars and started from scratch for all-new, lower, wider 1959 cars instead of facelifting the 1958’s.

    The 1958 Chevrolet and Pontiac cars were one-year wonders. The 1955-1956-1957 cars were essentially the same underneath; the 1959, 1960, 1961 and 1962 cars were largely similar underneath.

    That had to be hellaciously expensive…

  • avatar
    Ole Stang

    Great S-P history lesson
    Chryco still has that plant, would that be like karma coming back to rear it’s ugly head?
    note Chryco was sales leader in Canada for the month of February 2009 I believe, Ford 2nd, GM 3rd, Chryco made a bit of a big deal about it, first time in like 60 years GM had been out sold. Next week March results will come in. Let’s see if the US loan/Incentive support dollars work for another month.
    Full disclosure I sell Fords in southern Ontario, boo evil dealers. He He
    question?
    If Chyco stops getting our governements money and goes C7/11, Cerebus finally washes their hands of their failed bet some (insert name here)carco will buy the a plant(s) and name plate(s) they want such as the Ram Pick Up or Gr Caravan/Routan and the plant(s) will reopen. Is this scenario possible, the local workers like Mikey do not get shafted as badly(meaning still have jobs), the local parts suppliers are only mildly disrupted, or do we all just grab our ankles and keep a smile our faces and keep waiting for the inevitable ‘other shoe’.

  • avatar
    lw

    No way are they pulling out. Continual sales keep everyone cutting deals to lower costs in every direction. Only when the sales stop does the dance end.

    What we have seen so far is a widespread sales reduction due to a pullback in the credit and general worry about losing a job.

    The next hump down is when all the millions of newly unemployed don’t actually get new jobs again or get crap jobs whereby they can’t afford a car payment and rent.

    To everyone upset about the bailouts.. The general public is still deciding what it wants. if the decision is no more bailouts, the sales of those being bailed out will drop off dramatically compared to companies that haven’t been bailed out.

    Wouldn’t it be a pickle of GM sales started cranking up and Ford’s went down the toilet? Irony can be a real bitch….

  • avatar
    50merc

    menno: “The 1958 Chevrolet and Pontiac cars were one-year wonders. … That had to be hellaciously expensive…”

    Undoubtedly. The fact that GM could throw away dies and tooling used for only one model year (a recession year, too) reminds us what a titan of the industry it was.

    It’s also worthwhile to note that ’58 had brought a new chassis and family of engines. The Impala hardtop was, indeed, “all new.”

    I recall well the ’57 Plymouth ads boasting “suddenly it’s 1960!” (When the garish 1960 models eventually arrived, I was ready to go back to ’57!) Yet I suspect there was more to the GM restyling for ’59 than just an attempt to catch up with Chrysler. The ’58 Chevy and Pontiac looked bulky and without grace. Olds, Buick and Cadillac were horribly overchromed and also looked fat. Perhaps management realized the ’58 designs didn’t deserve a second chance.

  • avatar
    Geo. Levecque

    One correction the Plant Menno was talking about is not the old AMC plant which was in Bramalea part of Brampton, the present Plant is brand New and is right in the heart of Brampton, Ontario. Right now most of output of this Brampton Plant is stored on a disused Canadian Forces Station at Downsview, Ontario part of the GTA!
    We all hope that both sides see the “light” but in this year of “Change I dont think “pattern” bargaining is the way to go.
    Mikey you are right, the new Head Union man is not the same ilk as was Brother Hargrove, in fact The Business Network interviewed him on this same subject, the current head of CAW needs some
    education, also his grammar has a lot to be desired, he does no good to any Union with all the anti union blogs around, in my estimation.
    George CEP Retired Chief Steward!

  • avatar
    Canucknucklehead

    I don’t want one cent of my tax dollars going to these scumbags.

  • avatar
    NickR

    I was under the impression that Chrysler sold a ton of vehicles in Canada. How will this affect their sales?

    If they pull out, I hope my fellow Canadians will boycott them and not buy a single one of their vehicles.

    Geo. Levecque you must live awfully close to me if you see these cars all the time, like I do!

  • avatar
    Gardiner Westbound

    The Chrysler minivan design, tooling and production facilities are attractive liquidation acquisition prospects. Upgrade the quality and warranty to at least Hyundai standards and it could be a profitable long term investment.

    Ontario labor successor rights laws are an insurmountable barrier. The CAW has first right to the jobs. The unions own the McGuinty Liberal government ruling out legislative relief. I can’t imagine an investor foolish enough to risk money in an enterprise where the tail wags the dog.

  • avatar
    mikey

    No.. Gardiner Westbound the unions do not own the McGuinty government.They did own Bob Rae and the N.D.P. Where did that get us?Well let’s see,they let GM of the hook for pension contributions,in the early nineties.Something about “too big to fail”.That opened the door for Mike Harris and the neo cons.Protecting pensions wasn’t on thier agenda thats for sure.

    So Dalton McGuinty come’s along and wins back to back majority government’s.The auto industry is vital to Ontario’s economy.The Liberal’s are aware of this fact.Thier doing everything in thier
    power to keep us alive.

  • avatar
    Gardiner Westbound

    With respect, have you overlooked the Working Families Coalition and similar Liberal front, union backed attack dogs?

  • avatar
    mikey

    Yeah..good point Gardiner.That was hatched by the “anybody but Harris” bunch,and it sure didn’t hurt the Liberals.

  • avatar

    Boy is that picture ever begging for a caption..

    “I showed up to the labour negotiations and all I got was this lousy T-shirt”.

  • avatar
    LXbuilder

    One correction the Plant Menno was talking about is not the old AMC plant which was in Bramalea part of Brampton, the present Plant is brand New and is right in the heart of Brampton, Ontario.

    The plant in question is the ONLY plant in Brampton and IS in the Bramalea part of Brampton. It was formerly called Bramalea Assembly and the name was changed to Brampton Assembly when the old Brampton plant closed. The two plants were located within 20 minutes of each other. Both plants were built by AMC, but the current one became a Chrysler plant as it was ramping up for its first product.(the lovely Renault/Eagle Premier) The current plant opened in 87 and the old one in the early 60s.

    I have worked in both, and grew up 5min. from the current plant.

  • avatar
    mikey

    @KurtB.Like any photo op it’s kinda staged.Buzz I think has a golf shirt on.It would be a social “faux paux” for Buzz to wear anything closer to buisness casual.Notice the open collar on the other side of the table.Thats also planned,the message being,were all on equal footing here.

    Buzz never saw a camera he didn’t like.He always dressesd for the occasion.Buzz was never unshaven.
    Buzz kept his clothes neat and pressed.Remember union officials are politicions first,and leaders second.

  • avatar
    Canucknucklehead

    Buzz, in the end, besides being a complete idiot, committed hari-kiri with his asinine blockade of the GM headquarters in Oshawa. Talk about winning friends and influencing people.

    This claim to fame (as it were) was lobbying the government of Canada to force South Korea to accept vehicles made at CAW plants. Buzz, having been already recognised as a moron, has never set foot in the place and cannot realise that there would be no way on earth a single product made at Big 2.1 factory would ever be bought by a Korean. Imagine trying to park a Silverado 3500 in downtown Seoul or paying the road tax on a 3.9 litre Impala. Equally, Buzzie-boy could never fathom why humble Canucks like myself like Hondas and Toyotas (and Hyundais) so much. Maybe it is because once you buy one, the dealer becomes a memory for several years. I own three Honda cars and none of them has ever been back.

    Let them all go bust I say. Honda and Toyota are doing very well in Canada and they can pick up the slack in the Canadian market and export even more to the USA

  • avatar
    NickR

    Buzz, in the end, besides being a complete idiot

    I’ve heard him speak…he is even more of an idiot that you think.

  • avatar
    Canucknucklehead

    He can speak? Wow, that is a real stretch!

  • avatar
    mikey

    Guys! Buzz is retired,I sense a little animosity or envy maybe? Buzz did the job he was elected to do. What more can you ask of a leader?

  • avatar
    Canucknucklehead

    Buzz did the job he was elected to do.

    He sure got the boot fast when he p*ed in the soup.

  • avatar
    Gunit

    As a Canadian tax payer I don’t want the government giving any money to these guys. Car sales are down and will be for a long time, demographics will assure that, the market needs to contract and the weakest need to go.

    It wouldn’t stop me from buying one if they moved production out of the country, they don’t owe any country jobs. I’d still buy the best car for the money (which means I probably wouldn’t buy a Chrysler).

  • avatar
    Canucknucklehead

    Well, for Canadians, the best cars for the money for years have been the Toyota Corolla and the Honda Civic, both of which are domestically produced.

  • avatar
    COWBOY59

    Everyone listen, I have 25 years with Chrysler, and am 50+ years of age, Chrysler can leave Canada, but they would have to support me until I’m retirement eligible, which is in 4 years. At that point, they would gradually phase me into the 30 year retirement bracket, which means full pension and benefits. For those of us who paid our dues, and were smart about investing in the good times, a 4 year combination SUB + EI plus benefits is more than enough to live on. And then comes dessert, my 30 year package, with you guessed it, pension and benefits. I would not normally have mentioned this, but frankly, Ive been getting pretty upset being made the scapegoat for all of the auto industry’s problems, so va fungula.

  • avatar
    COWBOY59

    Something else, even if there is no agreement this weekend, we still have a valid contract until September of 2011, so why panic ?? Personally, I would rather keep things the way they are, with that extra SPA week later this year. Also, did some of you ever think one of the reasons why GM, Ford and Chrysler are having problems is because you don’t buy domestic vehicles ? We’re told to buy Canadian produce, Canadian building supplies, Canadian wines, Canadian clothing, etc….why not Canadian made vehicles ?? You want us to make $20 an hour or less ? What does that do to the poor bloke who’s already making $15 or less/hour, and whose wages are indirectly tied to ours? Will he be happy making proportionally less now because he hates us ??

  • avatar
    dougjp

    Cowboy59, your posts are a joke, right? You are trying hard (and quite successfully I might add, but only at first read) to discredit and insult the fine hard workers at auto plants (which your approach proves you are NOT one)?

    Clever try to show how bloated the wages and benefits are compared to everyone else in the world, even those with more education.

  • avatar
    COWBOY59

    dougjp, I know how hard I’ve worked these past 25+ years, with the crazy shift times and lack of quality family time, lack of sleep, dealing with crazy ass supervisors and dumb-ass fellow workers, etc…and now having to deal with a general public that is being spoon-fed disinformation from the media. That is the sole reason for my rant. And if I personally do have a ray of hope somewhere down the road, so be it. I didn’t steal my wages, didn’t sign the contract on behalf of the companies, just went to work to earn my daily bread. Another thing: why the animus on autoworkers?? Where is the outrage over our politicians perks, bank bailout money, people living beyond their means with oversized mortgages that we have to bail out now?? Show some fairness here.

  • avatar
    COWBOY59

    JOB SECURITY

    (308)
    (a) Eligible employees are those employees
    at the affected plant:
    (i) who are between age 50 and 55 with
    at least 10 years of credited service at the date of the plant
    closure and are not eligible for Regular Early Retirement; or
    (ii) who are at least age 48.1 but under
    age 50, with at least 9.1 years of credited service at the
    date of plant closure, who are placed on layoff and who
    then attain age 50 with at least 10 years of credited service.
    (b) Eligible employees will receive monthly
    PRIMP benefits equal to (a) the sum of the basic and
    supplementary benefit rates in effect under the provisions of
    the applicable pension plan at date of commencement of
    PRIMP benefits, multiplied by (b) the employee’s credited
    service at the date of plant closure or, if later, the date at
    which the employee attains age 50 with at least 10 years of
    credited service;

  • avatar
    LXbuilder

    Everyone listen, I have 25 years with Chrysler, and am 50+ years of age, Chrysler can leave Canada, but they would have to support me until I’m retirement eligible, which is in 4 years. At that point, they would gradually phase me into the 30 year retirement bracket, which means full pension and benefits. For those of us who paid our dues, and were smart about investing in the good times, a 4 year combination SUB + EI plus benefits is more than enough to live on. And then comes dessert, my 30 year package, with you guessed it, pension and benefits. I would not normally have mentioned this, but frankly, Ive been getting pretty upset being made the scapegoat for all of the auto industry’s problems, so va fungula.

    Uh? COWBOY59: You wouldn’t be getting most of this stuff if the company goes chaptor 7. Where would the money come from?

    I’m just short of 28yrs service and I’m not worried about Chrysler leaving Canada, they won’t. But there is a good chance they will go away.

  • avatar
    COWBOY59

    LX Builder, our pensions are vested, no problem there. These funds are kept separate from everything else. Benefits go, but you have to admit that a lot of our current benefits are useless for the vast majority of workers. But our pensions are guaranteed, count on it.

  • avatar
    mikey

    @Cowboy… From one brother to another.I feel your pain.But LX is right.After Chapter 11 or 7 or
    recievership,as we call it,your contract/agreement is a bunch of words on paper.

    Believe me brother I’ve been researching for 2yrs
    I took a package at 36.4 at GM Oshawa.I treat every pension check as my last one.

  • avatar
    COWBOY59

    My father-in-law used to work for a company that went belly-up last September. He was getting $**** every month, and since the bankruptcy his pension has remained intact. The pensions are vested with financial institutions as far as I know. And the company he worked with didn’t have near the financial clout as any of the big three. Our union has made sure that pension obligations remain outside the purview and reach of private companies, which is the reason they are vested. Besides, either the feds or provincial government guarantees a minimum of $1,000 per month in any such pension plans in existence.

  • avatar
    LXbuilder

    Yes the pension (a least in Canada) is untouchable to the company, but it is not “big” or “rich” enough to fund you or myself until our end. Not unless your planing on going young, I know I’m not counting on ever seeing any of it now. If I get lucky and am able to draw a full pension cheque or two that will be great, I’m just not going to count on it any more.

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