Looks like things could get ugly at GM during negotiations:


GM Canada targets the 'status quo'
Auto maker eyes time off, staffing and work rules in coming contract talks to better compete with Japanese companies' U.S. plants
GREG KEENAN

From Friday's Globe and Mail

April 18, 2008 at 2:30 AM EDT

TORONTO — — General Motors of Canada Ltd. [GM-N] is seeking a "transformational" change in its operations by reducing paid time off, allowing temporary workers and eliminating strict work rules, moves that almost certainly put it on a collision course with its unions.

The changes are essential to slash a $30-an-hour labour cost disadvantage against U.S. plants operated by Japan-based competitors, the auto maker says.

Wages, benefits, pensions and other costs for one hour of labour at the Canadian plants operated by the Detroit Three amount to $77.75, says a company background paper on the coming talks with the Canadian Auto Workers union. The same costs with the Canadian dollar at par against the U.S. currency total $47.50 an hour for U.S. plants operated by Honda Motor Co. Ltd., [HMC-N]Nissan Motor Co. Ltd. [NSANY-Q] and Toyota Motor Corp. [TM-N]

"When you look at how uncompetitive we are, you can't say we'll do some things and $1 an hour will do," said GM Canada spokesman Stew Low. "The status quo just won't do."


The background paper outlines what will be a difficult challenge for the CAW and the Canadian units of the Detroit Three in an automotive environment that has changed dramatically since the last round of negotiations in 2005. Since then, the Canadian dollar has hit par with the U.S. currency — contributing to annual losses at the Canadian unit of General Motors Corp. — and a landmark labour agreement in the United States appears to have slashed the three companies' costs in that country.

If GM sticks to the position hourly labour costs must be slashed by $30, they risk a monumental clash with the union, which has already drawn a line in the sand, saying the two-tiered wage structure adopted at U.S. sites won't be permitted at CAW plants.

"They can't get there," said CAW president Buzz Hargrove. "I've told [GM chairman] Rick Wagoner, I've told the head people at Ford and Chrysler — all of them — that there's absolutely no way in hell."

The union will not agree to wage cuts, reductions in health care benefits or lower pensions, Mr. Hargrove said, but he acknowledged that Canadian workers have more time off the job and "that would be one we would have to look at, given the circumstances we face."

Making the case for investment in the company's Canadian operations is already difficult given the dollar and the flat North American market, compared with strong growth in other markets such as China and Europe, said David Paterson, GM Canada's vice-president of corporate and environmental affairs.

Investment "becomes a lot harder to justify," Mr. Paterson said. "We're trying to invest right now. We've just laid out $3-billion worth of investments."

More than three-quarters of the $30 cost gap is generated by the labour costs for active employees, says the GM Canada paper, which argues that "we need to find a creative 'Made in Canada' solution to our cost challenges — and the solution must be transformational."

The paper notes that base wages and paid time off make up a significant slice of the gap, pointing out that CAW employees get 155 hours more time off annually than workers at the Japanese plants in the U.S.

CAW workers at GM Canada assembly plants get 46 minutes in breaks during an eight-hour shift, while U.S. workers at Toyota Motor Corp. plants get 30 minutes in breaks, the paper adds.

The GM officials also pointed to work rules, such as a ban on temporary workers. Such employees make up 10 to 15 per cent of the work forces at the Japanese plants, which gives them flexibility to adjust production quickly when the market changes.

Another area of concern is job responsibility. In some plants, a regular assembly line worker can change the welding tips on a robotic assembly arm, Mr. Low said. At GM's two Canadian assembly plants, that requires a skilled trades worker.

CAW economist Jim Stanford said GM Canada should compare hourly labour costs for active workers in Canada against those at Detroit Three U.S. plants represented by the United Auto Workers.

Such costs in Canada are $67 an hour and $60 in the United States, he said, and the $7 an hour difference is made up by the higher productivity of the company's Canadian operations.

 

Very Interesting! ..............

 

If I worked at one of the Canadian plants, I'd be looking for another job. GM can't keep paying that much over what the competition is paying and survive. While a $30.00 cut in pay is a bundle, it should never have gotten that high to begin with. GM will need to graduate a declining pay scale for these folks or a lot of them will go broke with the current bills they have. GM on the other hand could just shut the doors and move operations to Mexico. The pay scale down there is far lower than the Canadian import plants pay scale. Chrysler has a plant down there and GM has engine plants down there and they are paying $15.00 an hour net. They also have a 5 year waiting list of employees ready to go to work. Like it or not folks, we are becoming a global community and we have enjoyed the good life while others have supported our life style. We will have to do with less while the others catch up and things even out. Geez, I'm glad I'm 61 years old. You young folks have a lot of changes coming your way that I wouldn't want to deal with. Best of luck to the folks involved....you're gonna need it.

 

The biggest threat to the Camaro is it's a CHEVY!!

 

Well that is easy to solve. Ford and gm need to leave canada as a manufacturer of there products. canadian labor laws really suck. Total socialism.

 

I guess the Mustang is going to beat the Crapmaro again !!

PS: I'm only kidding so no one get too butt hurt about it.

 

Bah... camaro never did sell as many cars as mustang. Why start now? My favorite year of camaro is the 2005 model. Real sharp lines and the best quality they ever put in one.

 

It disgusts me to my inner core that products that were once built here in the good ole USA, are being farmed out to crapola el cheapo labor prositute countries like MeHico! The USA was once the Industrial Giant of the World especially in WW2! Maybe it will take another WW3 for the Industry to come home!............

 

What's that? Seems to me 2002 was the last year of the Camaro. You sure you don't mean a concept car?

 

Anyone hear wind of Pontiac launching a new 2009 Firebird? I heard it from my friend who stays on the prowl about these Second-Gen Pony Wars

 

Ain't happening.

 

It was a joke since the Crapmaro has been long gone while the Mustangs have been selling strong as ever.

 

I still like the Mustangs... even the new body styles surprisingly.

Ford's trucks are a little sketchy on the newer appearances...

 

They make $60.00 an hour and don't think they are over paid???

 

You could pay a union auto worker $100 dollars an hour and they could tell you with a straight face they are underpaid and have poor benefits. Domestic vehicles quality and reliability will match that of Foreign vehicles when the unions are booted out. Until then we'll keep hearing stories about the UAW on strike because of pay, benefits, and working conditions. GIVE ME A BREAK!!!