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Fiat Chrysler CEO Sergio Marchionne

Fiat Chrysler Avoids Canada Strike with C$400 Million Deal

Oct. 11, 2016
The union was seeking an agreement similar to one reached with General Motors that included commitments to invest in Canadian facilities.

Fiat Chrysler Automobiles NV (IW 1000/20) reached a tentative agreement with workers in Canada whose union president said will include more than C$400 million (US$300 million) in total investment.

The automaker agreed to spend C$325 million on rebuilding the paint shop at the Brampton assembly plant building the Chrysler 300 and Dodge Charger and Challenger models, Unifor National President Jerry Dias told reporters in Toronto, minutes before a midnight Monday strike deadline. The deal is subject to an Oct. 16 ratification vote by about 9,750 members.

The union, backed by its members’ authorization to strike after a vote in August, was seeking an agreement similar to one reached with General Motors Co. that included commitments to invest in Canadian facilities. Workers’ negotiating power has weakened from past decades as Detroit-based automakers have restructured to avoid swings in Canada’s currency and shifted production to lower-cost Mexico.

“Our members in Brampton have been on eggshells for years,” Dias said of workers at the plant, home to one of Fiat Chrysler’s oldest paint shops worldwide. After “mass exodus” of investment from Canada, the union is now seeing “major investment,” he said.

Canada’s auto output fell to 13% of North American production last year, from about 17% in 2009, according to data from Ward’s Automotive Yearbook. Output in Mexico rose to about 20% during the same span. Canada lost more than 53,000 automotive jobs from 2001 to 2014, according to a study by the Automotive Policy Research Centre.

Terms of the tentative agreement also include 2% wage increases in the first year and C$6,000 signing bonus, Dias said. If the agreement is ratified, Unifor talks will begin immediately with Ford Motor Co.

Fiat Chrysler confirmed a tentative agreement was reached in an e-mailed statement, though spokeswoman LouAnn Gosselin declined to discuss details pending the union’s vote.

By Greg Quinn

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