Monday, September 24, 2007

UP TO 100,000 CANADIAN LAYOFFS FROM STRIKE

UPDATE 1-Up to 100,000 Canadian layoffs seen from GM strike

"Our car plants will be impacted almost immediately," Buzz Hargrove, President of the Canadian Auto Workers Union said. (CP PHOTO/Nathan Denette)

Mon Sep 24, 2007 3:43pm EDT

100,000 Canadians could be idled by General Motors U.S. strike: Hargrove

TORONTO - Tens of thousands of workers at General Motors of Canada and in the Canadian auto parts industry are being hit by the impact of the strike against GM in the United States, Canadian Auto Workers president Buzz Hargrove said Monday.

"It's not inconceivable that by the end of this week we could have anywhere between 80,000 and 100,000 people unemployed - mostly in Ontario, some in Quebec - as a result of the dispute," Hargrove said.

The walkout by 73,000 United Auto Workers members, with the UAW saying talks are hung up on job security, originates in the automaker's effort to shift the pain of "unfair" imports onto workers, Hargrove said.

And he indicated he suspects GM will take a similar approach in negotiations with its Canadian workforce next year.

"Our car plants will be impacted almost immediately," Hargrove told a news conference about 2 1/2 hours after the U.S. union's walkout began, saying 17,500 GM Canada workers stand to be affected.

General Motors Canada spokesman Stew Low declined to be specific about a shutdown schedule, saying it was largely business as usual Monday and "we're going to work to keep running absolutely as long as we can, and we'll just take that on a day-by-day basis."

Hargrove said GM Canada's No. 1 car plant in Oshawa, east of Toronto, will stop producing Chevrolet Impala sedans early Tuesday morning, and the No. 2 Oshawa plant, assembling the Pontiac Grand Prix and Buick Allure, will shut down at the end of Tuesday's day shift. Those two plants employ 5,600 people.

The 3,900-worker Oshawa truck plant, he said, has enough parts to keep building Silverado and Sierra pickups for about three days.

The assembly plants are affected by shortages of parts delivered on a just-in-time basis from GM in the U.S.

Meanwhile, GM's 1,400-worker transmission factory in Windsor, Ont., has already closed and Hargrove said a 3,200-employee powertrain-components plant in St. Catharines, Ont., will soon wind down because of lack of U.S. demand for their output.

Hargrove estimated as many as 40,000 people at independent parts producers could be laid off "within the next few days" if the GM strike continues. He said there are 80,000 workers in the Canadian parts sector and GM buys about half of their production, while thousands of other jobs could be affected in spinoff effects at companies dealing with GM and the parts makers.

Canada's largest car-parts maker, Magna International (TSX:MG.A) said it is hopeful GM will return to normal quickly, but "depending on the length of the strike, Magna International may be required to suspend the supply of parts to General Motors."

Given the tough talk from UAW president Ron Gettelfinger, "I think this thing's going to drag on for a while," Hargrove said.

"I don't know how long at this point. That'll become more clear over the next few days."

He said the UAW bargainers put in an "incredible effort," but "General Motors appears to be saying to the UAW - and probably to us next year - that . . . they're going to try to make the UAW members and their families and communities pay" for the troubles caused by foreign competition.

Hargrove said imports from Japan, Korea and Europe account for one-quarter of the North American auto market, and another quarter is held by vehicles assembled in North America by offshore-based companies.

Auto industry analyst Dennis DesRosiers said the impact of the U.S. strike will ripple through the entire North American auto sector.

DesRosiers said GM needs wage and benefit rollbacks to compete with Asian automakers, as he estimates GM's labour costs are $25 an hour above those at Toyota and Honda.

The strike "suggests that at least General Motors is prepared to take a little harder line than they have historically," said Chris Piper, a business professor at the University of Western Ontario.

"The good news short-term is that GM may be able to work its inventory down, so it won't be too costly."

Looking ahead to the expiry of the CAW's contracts next September, Hargrove said the strong Canadian dollar is a concern, but this is offset by Canada's "huge advantage" over U.S. plants in health-care expenses and laid-off-worker costs.

"Our problem is not UAW bargaining: our problem is imports, imports, imports, market share loss, market share loss, and lack of recognition by (Prime Minister Stephen) Harper and (Finance Minister Jim) Flaherty that we have a major crisis in our industry."

He said laid-off GM workers are entitled to Employment Insurance payouts plus a supplementary layoff benefit, totalling about 65 per cent of their normal pay after a one-week waiting period.



Source: http://canadianpress.google.com/article/ALeqM5isySDQ6TVyU7UZt0d8GeGvHPHMSg

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