Tuesday, May 19, 2009

GM, CAW adjourn talks until Monday

Talks between General Motors and the Canadian Auto Workers union will continue on Monday in an effort to reach a new agreement on cost concessions.

The two sides negotiated through the weekend at a downtown Toronto hotel after a government-imposed deadline of midnight Friday passed without a deal being struck.

CAW president Ken Lewenza said the federal and Ontario governments told them that talks could continue for a couple more days, providing they make progress.

Lewenza earlier described the mood at the bargaining table as near despair.

The two levels of government are demanding that GM drastically cut costs to be eligible for billions of dollars in aid. In February, GM asked for $6 billion in loans from the two governments.

A June 1 deadline looms over the company to present its restructuring plans to government.

Lewenza said the union has already agreed to concessions greater than those it gave Chrysler Canada.

Chrysler and the CAW agreed last month on a deal that cut the company's labour costs by $19 an hour per worker. GM is in an even worse financial position, in part due to a ballooning pension deficit.

In March, GM and the union worked out a new labour deal that cut labour costs by about $7 an hour per worker.

However, government later rejected it as being insufficient.

Both Prime Minister Stephen Harper and Ontario Premier Dalton McGuinty have insisted that labour, management, bondholders and financial institutions must all make concessions that are significant enough to ensure the company's long-term viability.

Otherwise, they say, there will be no more government financial support.