Roles Reversed in Ford Negotiations

Competitiveness stronger incentive for union than management

by Gordon Sova (gordon.sova@thomsonreuters.com)

Something is going on in the current Ford of Canada negotiations with the Canadian Auto Workers that you don’t see every day.

Ford’s brass took the position earlier in the year that the company didn’t need union concessions in Canada (unlike GM and Chrysler) and would be profitable even without them by 2011.  (Ford had negotiated concessions in the U.S. with the UAW.)

Not surprisingly, however, they have also stated that they want and expect to enjoy the same cost reductions as their competitors. 

But, if you read the internal newsletters of the CAW locals at Ontario plants in Windsor, Oakville and St. Thomas, Ford is on the brink of collapse, chalking up back-to-back annual losses and staggering under a $32 billion debt load.

It’s not every day that the union bends over backwards to convince its members that the company they are bargaining with is in a much worse financial situation than the company likes to admit.  And that they should be ready to give up concessions.

One has to believe that Ford workers have been listening to their company executives and are asking the union why they need to give up anything.  Sales are up; market share is up.  The CAW, which wants to keep a level playing field with an auto industry pattern and fears Ford will relocate future investment to the U.S., needs to get the concessions and is putting on the pressure to make members understand the issues involved.

Union communications this time look very different from the normal “Stay solid, stand up to the employer and we’ll achieve our goals” messages going into negotiations.

The parties are headed back to the bargaining table and will most likely replicate the same concessions that Ford’s domestic partners have already agreed to.  It all makes sense, but it’s not your run-of-the mill contract talks.