By on June 13, 2012

Calling Canada “the most expensive place in the world to build a car right now“, Dan Akerson threw his hat into the “hourly wage costs need to come down” ring at GM’s annual shareholders meeting on Tuesday.

Unlike in the United States, there is no two-tier wage scale for Canadian Auto Workers union members, a decision that prompted GM to close a line at the Oshawa assembly plant, and move production of the Impala and Equinox to plans where workers can make $14 an hour rather than $32 an hour.

GM’s “all-in” labor costs in Canada are estimated to be $60 per hour, whereas the pre-2011 agreement  that GM had signed with the UAW meant that American labor costs pegged at about $56 an hour. Negotiations between the Big Three and the CAW are due once the current labor contracts expire in September. The CAW responded by stating that the strong Canadian dollar and higher labor costs was evened out by increased productivity. GM’s Oshawa plant in particular has a stellar reputation as one of GM’s best plants.

Sparring over things like cost-of-living adjustments has already begun between the two sides, while bonuses based on company profitability are expected to be the biggest sticking point in negotiations.

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21 Comments on “GM’s Akerson Asks CAW To Cut Hourly Wage Costs...”

  • avatar

    I find it hard to believe that Oshawa CAW labor could before expensive than Bochum IG-Metall labor could be…

  • avatar

    $32 an hour?

    Holy crap.

    • 0 avatar

      …$32 an hour?…Really!; Why would those jokers think they would be worth anywhere near twice the average selling price of a GM Vehicle? ($33,289-March 12; True car data). The nerve! GM should ship production to China where the citizens are happy to do it for $300/month (no one knows how many hours..not 40 though!) I bet you can even get a CEO for a lot less than the $3,702/hr that Akerson is paid!

      The sooner the dummies working in auto plants realize that they are not entitled to a middle-class life and accept their lot in life as modern serfs the better!…Romney 2012!

      • 0 avatar

        To answer your question literally, I suspect they think they’re worth that much because they’ve spent years being insulated from the labor market and reality in general, which has resulted in entirely unrealistic expectations for the real value of their time and skills.

        Do you contend that people *are* inherently entitled to a middle class life?

        Are auto workers more entitled to this middle class life than, say, food service workers? If so, why?

      • 0 avatar

        Actually yeah, if you work your ass off and make complex and expensive products for a company then you should be middle class. It is a more specialized and high skilled labor than food service.

      • 0 avatar
        Volts On Fire

        $32/hr is entirely too much to expect when your only responsibility is performing the modern day equivalent of inserting Tab A into Slot B. As a whole those products may be complex, but broken down on a per-task level it’s only menial labor, nothing more. $16/hr is far more realistic.

      • 0 avatar

        “It is a more specialized and high skilled labor than food service.”

        If that is truly the case, then if GM won’t pay them what they’re “worth” then they should be able to leave and get another job somewhere that appreciates the specialized high skills, right?

        I suspect in reality they’d find themselves fielding offers in the $7-10 an hour range from Best Buy and Taco Bell. If that is correct, then they are by definition not worth $32 an hour.

        The value of the product being made is irrelevant. Do you think the guys who build Escalades should be paid more than the guys building Sonics, simply because the Escalade sells for more?

      • 0 avatar
        Volts On Fire

        “I suspect in reality they’d find themselves fielding offers in the $7-10 an hour range from Best Buy and Taco Bell. If that is correct, then they are by definition not worth $32 an hour.”


  • avatar

    I thought Germany had the most expensive car assembly labor costs.

  • avatar

    I suppose Dan will take a pay cut as well, as a gesture of good faith.

  • avatar
    schmitt trigger

    Neither party in this “negotiation” appears to have learned anything from actual worldwide vehicle-manufacturing realities.
    They are still locked in 1970s mentality.

  • avatar

    The $4 difference between Canadian and US labor rates hardly seems worth threatening jobs over.

    If the UAW/CAW wanted to save jobs, they’d dissolve themselves and let the workers be at parity with the transplants. If that happened, some of the workers would get a pay raise.

  • avatar

    GM vehicle assembly in Oshawa will end. It’s not a matter of ‘if’ but ‘when’.

  • avatar

    Are they accepting applications? :D

  • avatar

    let him take half, prick.

  • avatar

    $32/hr? I need a job there…

  • avatar
    el scotto

    How many of you have ever worked in a factory? I think a great many in here sneer at anyone who doesn’t work in a cubicle. With their “superior” attitude they find it oh so easy to make cheap shots at the working person. Until they’re outsourced.

    • 0 avatar

      el scotto:

      I haven’t worked in a factory. My father however, has and does. Personally, I have the great honor of FIXING cars whenever the factory f***s up, or replacing a defective part due to bean-counting.

      I happen to work on the cars of the cubicle workers, most of which couldn’t tie their shoes without being shown how every time, let alone change their own engine oil. This is indicative of failed liberal (sorry guys, couldn’t come up with a better word) ideology (i.e., ‘if it’s broke, simply throw more and more and more $ at it’).

      When one can go to Canada and make $30+/hr turning a couple of bolts or snapping in a piece of plastic, and the guy who HAS TO FIX THEIR SCREWUP makes 1/2 of that (if you’re lucky), now THERE is a problem.

      Bush 43 should haver hired Gov. Romney as the car-czar. He would’ve simply cannibalized the ol’ General and started from scratch. OR, even better, realized what a basket-case GM is and liquidated it. Of course, that is how capitalism USED TO work.

      This concludes my heavily-biased UAW/CAW slam of the day…:)

  • avatar

    So that is around $62000 per year based on 37.5 hour work week and 52 pays. Minus 20%-25% income tax plus Canada Pension Plan and Employment Insurance and labour fees for being in an union. Yes, it is a comfortable wage considering owning a home in Oshawa is less expensive than the metropolis just west of them. Then factor in how difficult the job is in relation to other manufacturing jobs on the market. Then factor in how important the job is (assembling cars or directing robots to help assemble cars — I’ve never assembled a car before but have watched videos, looks rather boring from a job perspective) considering there are safety factors in the product that is being assembled so precision and quality are of high importance.

    I think what keeps the GM plant alive is the fact that our government keeps giving tax cuts and other monies to the manufacturer plus a good health care system (you can have a heart attack on the cheap in Ontario) so while GM probably wants to bail, their threats always go back to the gov’t and they (we) throw more money at it. So in the end we pay more tax to keep jobs alive. And then we end up paying more to offset the tax/cost of living increases.

    Is assembling cars worth $32/hour? No.

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