CAW, Chrysler adjourn talks until Saturday, government deadline looms

Ken Lewenza speaks at a news conference in Toronto on Friday.(CBC)

The Canadian Auto Workers and Chrysler Canada Inc. have adjourned talks for the day on wage concessions without reaching a deal, leaving the two sides only four days to meet a federal-provincial deadline for new cash.

The talks were adjourned in the evening to allow the union's negotiating team to consult with the membership at meetings planned for Saturday and Sunday. Both sides said they hoped to resume talks Saturday.

"We're still talking but we're not making much progress," Ken Lewenza, president of the autoworkers union, said in a phone interview Friday night.

Chrysler and the CAW have held intense negotiations since Monday, Lewenza said, but have not inked an agreement that would see Chrysler's workers make concessions.

"Two times in the past 24 hours, we assumed the company understood the pattern [of a collective agreement]. Both times, the goal posts moved," said a tired Lewenza at a Toronto news conference earlier Friday.

He wondered aloud whether the Canadian division's bargaining team is being overruled by Chrysler majority owner Cerberus Capital, by the U.S. parent company's bankers or by the U.S. Treasury.

"Is there something that we're not aware of? Because we can't rationalize why every time we figured we got close, the post moved," Lewenza said.

Tony Faria, co-director of the automotive research centre at the University of Windsor, said there is no question Cerberus is involved in the negotiations.

"It's quite possible that the Canadian Chrysler negotiating team was bending a bit on a few issues but when they communicated that information they were told, 'No, you've got to hold the line on that,' " Faria said.

'These are not normal business circumstances'

Each time the two sides came close to finalizing a deal, the CAW was presented with new demands for concessions, Lewenza said.

The CAW has already reached an agreement with General Motors Corp. that would cut labour costs by approximately $7 an hour. Commonly, whatever deal the auto workers cut with the first firm becomes the template for contracts with the other two major domestic producers.

This time, however, Chrysler LLC president Tom LaSorda signalled a change as he called the GM pact "unacceptable" and hinted that the company might yank production in Canada entirely.

"We were never going to give one company an advantage over another company," Lewenza said.

Reports pegged Chrysler's request for savings in the range of $19 an hour.

Chrysler said past practices, such as the CAW's pattern bargaining, cannot be applied in the current economic environment, and the gap between the $7 and $19 needs to be closed further.

"Although we made progress toward 'closing the gap,' significant issues related to the existing 'pattern' remain on the table. These are not normal business circumstances and all Chrysler constituents have been asked to 'break pattern' — employees, retirees, dealers, suppliers and others," Chrysler said in a statement.

Chrysler still economical in Canada

CAW economist Jim Stanford said even at $7 an hour, Chrysler's facilities, which include assembly plants in Brampton and Windsor and a casting plant in Toronto, are still more competitive than those in the United States.

Stanford cited one study that estimated the assembly time for a mini-van at 5.5 hours less in Windsor than at a similar facility in St. Louis.

"There is no reason to think about a [Chrysler] exit from Canada," he said.

The CAW said its main negotiating team would be available for talks. But the union's ratification process, Lewenza said, was such that getting a workers' vote on any deal before Tuesday now would be difficult.

The federal and Ontario governments set a deadline of March 31 for the CAW and Chrysler to reach a deal on labour costs as a prerequisite to the ailing automaker receiving public bailout cash.

A spokeswoman for federal Industry Minister Tony Clement said he is "not married to the deadline." A spokesman for Ontario Economic Development Minister Michael Bryant said the minister was keeping a close eye on the negotiations, but didn't specify whether he would be willing to push back the deadline.

Ontario is "keeping a close eye on [negotiations]," said Greg Crone, press secretary to Michael Bryant.

With files from the Canadian Press