October 16, 2017 / 6:28 PM / 2 years ago

Striking Canadian autoworkers ratify GM deal

MONTREAL (Reuters) - Striking Canadian workers on Monday voted nearly 86 percent in favor of a new four-year agreement with General Motors Co (GM.N) in a deal that would make it more costly for the U.S. automaker to shut the Ontario plant.

A striking member of the auto workers union Unifor walks to a picket line past a trailer covered by with a Canadian flag reading "Canadian Made Matters!", outside the General Motors Company (GM) CAMI assembly plant in Ingersoll, Ontario, Canada October 13, 2017. REUTERS/Chris Helgren

The U.S. auto maker and the union, Unifor, had reached a tentative deal on Friday for about 2,500 workers at the CAMI plant in Ingersoll, after a near month-long strike.

The workers walked off the job on Sept. 18 after GM rejected a union call to designate the factory as the lead production site for its popular Chevrolet Equinox sport utility vehicle model in North America.

The strike followed union demands for guarantees to prevent GM from shifting Canadian production of the strong-selling Equinox toward two factories in Mexico at a time when the auto maker has been scaling back manufacturing in Canada.

The deal would create a C$300 million ($239.5 million) fund for workers in the event GM ever decides to close CAMI, and employees would have to be offered early retirement incentives in the case of layoffs, plant chair Mike Van Boekel told Reuters in a telephone interview.

“If they want to lay anybody off, it will be expensive,” Van Boekel said.

The benefits will bring the CAMI plant in line with other unionized automaking facilities in Canada, an industry source said.

About 400 workers were laid off at the plant this year after an older Equinox model was phased out and GM moved production of a similar SUV model, the Terrain, to Mexico.

In a statement, GM called Monday’s vote “welcome” news for the company.

Production was to resume late Monday night at CAMI following Canada’s first GM assembly strike since 1996.

CAMI is not GM’s biggest plant outside of the United States, but the Equinox SUV is a popular model in one of the fastest- growing segments of the North American market.

GM warned the union last week that it would start winding down production at the plant and ramp up output in Mexico unless workers called off their strike. The union had blamed the North American Free Trade Agreement, which is now being renegotiated, and Mexico’s cheaper labor costs for the job losses..

Between 2004 and 2017, GM’s vehicle-making footprint in Canada has shrunk by 61 percent, with the automaker producing about 407,000 units this year, according to data from AutoForecast Solutions LLC.

GM is expected to build 321,000 autos in Canada in 2018, with most of those being the Chevrolet Equinox, said AutoForecast’s Sam Fiorani.

Apart from the fund, workers will get a C$6,000 signing bonus, immediate 2 percent raises and regular $2,000 bonuses at Christmas, Van Boekel said.

($1 = 1.2524 Canadian dollars)

Reporting by Allison Lampert; Editing by Leslie Adler and Dan Grebler

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