Ontario plants get $1.19B investment in Unifor tentative agreement with FCA
Fiat Chrysler Automobiles NV on Thursday committed to investing up to $1.19 billion in its Canadian facilities as a part of a three-year tentative agreement reached with labor union Unifor, which said the deal would provide stability for jobs well into future.
Unifor secured new product allocations to Windsor Assembly and Etobicoke Casting that will create more than 2,100 jobs as well as new derivatives to enhance the existing Dodge and Chrysler sedans built at Brampton Assembly. Otherwise, the agreement follows the pattern established by the contract ratified with Ford Motor Co. last month with respect to wage increases and other benefits. FCA employs approximately 9,000 Unifor members, the largest Canadian workforce of Detroit's three automakers.
"I am so pleased to know that we have a strategy today with everyone understanding the importance of these critical jobs and what this means for stability for the long term," Unifor President Jerry Dias said in a news conference detailing the agreement. "This is an opportunity to say to young people this is an industry that is not stagnating. In fact, it is growing."
Voting is set to begin 10 a.m. Sunday and conclude within 24 hours, according to a Unifor news release. The union is planning a series of ratification virtual meetings over the weekend to educate members on the deal.
Up to $1.13 billion (1.5 billion Canadian dollars) of Fiat Chrysler's commitment will go to its minivan plant in Windsor. The company will allocate a new platform that will support plug-in hybrid and battery-electric vehicles by 2024, Dias said.
"We know that this platform will have the stability to build multiple, multiple vehicles, everything from pickup trucks to cars to crossovers," he said. "For us, this is global technology at its finest. This is about global platforms. This is about the ability to turn on a dime based on consumers’ demand. This investment, we know, will solidify the footprint in the community in Windsor and Essex County for many, many years."
The allocation will mark the return of the third shift at Windsor, which was cut with 1,500 jobs this summer after being instituted in 1993. After early retirements, 425 Windsor members remain laid off, Dias said. The 4,464-hourly person headcount is expected to grow by more than 2,000 starting in 2023 with a 38-week ramp-up of the new platform.
"We went in knowing that it is quite likely there will be more layoffs in Windsor," DIas said. "So it was critical for us to stabilize the footprint In Windsor, because we know a strong footprint in Windsor creates a strong footprint as well in Brampton."
Brampton Assembly produces the Chrysler 300, Dodge Charger and Dodge Challenger. The company has committed to three new derivatives of those vehicles, one for each year of the agreement's tenure. The assembly plant and satellite stamping plant employ 2,985 hourly workers.
Toronto's Etobicoke Casting is in the process of launching a new product and will receive two other products, Dias added. After employment fell from around 500 people to 164 hourly, the additions will return more than 100 workers who took transfers to Brampton in 2021 and 2022. The plant produces aluminum die castings for a variety of Chrysler, Jeep, Dodge and Ram vehicles.
Fiat Chrysler's investments are estimated to be between $1.07 billion and $1.19 billion (1.42 billion to 1.57 billion in Canadian dollars), and talks continue with federal and provincial governments concerning public incentives, Dias said. Each level of government committed $223 million (295 Canadian dollars) to Ford's nearly $1.4 billion (1.8 billion Canadian dollars) investment in its Oakville Assembly plant for electric vehicles.
Fiat Chrysler declined to comment on possible incentives. The auto sector remains an important contribution to Canadian jobs and the economy, John Power, representative for Navdeep Bains, Canada's minister of Innovation, Science and Economic Development, said in a statement.
"We are at the table and prepared to support the future of our auto sector, particularly with regards to the development of electric vehicle and battery production here in Canada," Power said.
All parties understand the importance of the transformation to electric vehicles, Dias said, adding on whether those negotiations should affect FCA's commitments to Windsor, "the answer is absolutely no."
The union announced the deal Wednesday minutes before an 11:59 p.m. deadline. In an update posted 48 hours ahead, Unifor had said it "continues to wait for firm commitments on facility investments and product allocations."
Canadian employees at Ford Motor Co. last month ratified a shorter, three-year contract with 81% support. The deal included $1.5 billion in investment to build electric vehicles in Canada, two 2.5% wage increases, ratification bonuses, premiums for afternoon and midnight shifts and a reduced eight-year grow-in period to reach top wages, down from 11 years.
"I will argue it’s the best economic agreement we put together in 20-25 years," Dias said.
After workers ratify a contract with Fiat Chrysler, Unifor as early as next week will pivot to General Motors Co., its final automaker in the negotiations. The contracts cover roughly 17,000 of the more than 19,000 autoworkers at Detroit's three companies represented by the union.
"We have an aggressive agenda in front of us," Dias said of talks with GM. "We've had ongoing conversations about bargaining in 2020, and we'll see where we end up."