In a series of announcements over the past several weeks, representatives of the Canadian auto industry have served notice that they are preparing a massive assault on the jobs, wages and benefits of autoworkers in Ontario and throughout the country. With the strength of the US greenback falling to sub-par levels against the Canadian dollar and in the wake of the historic concessions contracts forced on American workers by Detroit’s Big Three carmakers—General Motors, Ford and Chrysler—and the United Auto Workers union (UAW), the competitive advantage previously enjoyed by auto magnates north of the border has all but evaporated.
“In the not too distant past,” stated Canadian Vehicle Manufacturer’s Association President Mark Nantais to the government’s Finance Committee, “Canada had a competitive advantage within North America to help attract new investment. Today…Canada is the highest-cost jurisdiction globally for many auto manufacturers to operate. This reality leaves Canada at a competitive disadvantage at attracting the ongoing investments needed to remain globally competitive”
Nantais presented figures to the committee showing that hourly labour costs at GM, Ford and Chrysler plants in Canada, including pensions and healthcare expenses, are around $70. He argued that all-in labour costs for the Detroit Three in the United States, which previously had been about $75 per hour, could dip to as low as $50 per hour as the massive concessions agreed to by the UAW begin to take effect. Those concessions included the establishment of a two-tier wage system (new hires earn only $14 per hour) and the dumping of tens of billions of dollars in retiree healthcare obligations. Continued plant closures and layoffs were also announced.