National Post (Latest Edition)
Ford deal a ‘game-changer’.
‘Game-changer’ investment in electric vehicles
TORONTO• Canadian employees of Ford Motor Co. began voting Sunday on a new contract that their union says includes wage hikes, bonuses and a $ 1.8- billion investment to establish the country’s first plant that would mass- produce battery electric vehicles — with some financial help from the government.
Unifor, Canada’s largest private- sector union, announced Sunday morning that its local leadership had unanimously endorsed a tentative agreement reached with Ford of Canada on a three-year labour contract.
“By delivering a unanimous decision, our local leadership have made their position clear: this tentative agreement with Ford delivers what our members need now and in the future,” Jerry Dias, Unifor’s national president, said in a news release.
Unionized Ford workers met Sunday to go over the details of the contract and vote on it, with results expected to be announced on Monday. The union says it represents approximately 6,300 workers at Ford facilities in Canada, including 4,250 tied to the company’s Oakville, Ont. plant, where Ford Edge and Lincoln Nautilus sport utility vehicles are manufactured.
U ni for and Ford announced on Sept .22 that they had reached a tentative agreement, avoiding a strike and creating a “pattern” the union will use in negotiations with the other two members of the Detroit Three car companies, Fiat Chrysler Automobiles N.V. and General Motors Co.
Collective agreements between the companies and their unionized Canadian workers expired Sept. 21, with Unifor saying it would negotiate next with Fiat Chrysler.
A summary of the tentative agreement with Ford of Canada, published by Unifor, shows workers would receive wage increases of 2.5 per cent in the first and third years of the contract. They would also receive a onetime “Productivity and Quality Bonus” of $ 7,250 if the deal is ratified, among other contract details released by the union.
But the centrepiece of the deal is the $ 1.95 billion investment in Ford’s Oakville and Windsor, Ont. plants. Concerns about the former’s future beyond 2023 was a key reason why Unifor began its bargaining with Ford.
The Oakville facility is also set to receive the lion’s share of the $ 1.95 billion, as Unifor says the plant is to be retooled so it can build electric vehicles after Edge production is phased out. That $ 1.8- billion project is to begin in 2024, with the first battery-powered vehicle forecast to roll off the assembly line in 2026, “and hopefully sooner,” the union says.
“This is one of the most significant investment announcements in Canadian automotive history, and is a game- changer for the Canadian auto sector,” the Unifor summary says. “Through this conversion, Oakville will become the first mass production ( battery electric vehicle) plant in Canada — and one of only a few currently in North America.”
Unifor has stressed that government support is key to the country’s embattled auto sector, and that funding commitments from the Ontario and federal government were instrumental in nailing down the investment from Ford.
Included in the Unifor summary is a letter purportedly from Ford Canada’s vice- president of human resources, which says Nautilus production at Oakville has been planned to “balance out” in the second quarter of 2023. The company “confirmed” production of frontwheel drive Edges should continue through the same quarter and that production of the all- wheel- drive Edge is anticipated to continue through the life of the contract with Unifor, the letter says.
It also states that the plan to transform the Oakville assembly plant into an electric- vehicle plant is “contingent on necessary agreements made in partnership among the company, the union and federal and provincial governments,” including the implementation of the new contract and government incentives.
“The total impact of this plan is estimated at up to 3,000 new or secured jobs at ( the Oakville Assembly Complex) by 2027,” and approximately $ 1.8 billion of expenditures or investment, the letter says.
Another $ 148 million or so would be spent on Ford’s engine plant in Windsor, the letter says, in addition to the company’s plans to sell its Bramalea Parts Distribution Centre and lease two new parts depots.
The letter also says that both sides “recognize that for the Canadian automotive manufacturing industry to remain competitive, contributions from Industry, Unions and Government are necessary.”
“Accordingly, the union agreed that it would partner with the company to approach provincial and federal governments to obtain financial incentives that will support the business case and contribute to the success of this vision as set out in the letter,” it says.
A spokesperson for Ford said the company will not discuss contract specifics, in order to “respect the ratification process.”
However, there are signs both Ottawa and Queen’s Park could provide assistance.
Ontario Premier Doug Ford has said his government stands ready to invest in Ford’s Oakville plant when the contract talks finish. Me a nw h i l e , the throne speech from Prime Minister Justin Trudeau’s government on Wednesday said Ottawa would create a new fund to attract investment in manufac turing zero- emission products and halve the corporate tax rate for companies that do so.
“The Government will ensure Canada is the most competitive jurisdiction in the world for clean technology companies,” the speech declared.
Oakville will become the first mass production (battery ev) plant in Canada.