TORONTO -- DaimlerChrysler must give workers at its two big assembly plants in Canada incentives to leave as it seeks to cut jobs to reduce costs, the Canadian Auto Workers union warned on Thursday.
The CAW conceded DaimlerChrysler will make significant job cuts at the assembly plants in the Ontario cities of Windsor and Brampton over the next year, but said it did not know how many of its 9,722 union members at the facilities would be affected.
DaimlerChrysler Canada is the last Big Three automaker to sit down with the CAW this week to talk about negotiations for a new contract. The CAW's current three-year contracts with DaimlerChrysler Canada, Ford Motor Co. of Canada and General Motors of Canada expire on Sept. 20.
DaimlerChrysler Canada says technological advances will allow it to reduce the hours it takes to build vehicles, a move the CAW is not opposing in principle.
"We're embracing the idea of doing more with less people as long as it's not disadvantageous to our people and they make a commitment to people," CAW president Buzz Hargrove said.
"A way to adjust to those things is to put incentives on the table and encourage senior workers to leave the workplace as you're reducing and keeping junior people working and even hiring people."
DaimlerChrysler Canada said its labor costs have increased an average of about 6 percent a year since 1990, an increase it says is no longer sustainable.
The popularity of Japanese vehicles and the surge in gasoline prices are among the factors that are making the sales market difficult for the DaimlerChrysler Canada, and its traditional competitors Ford and GM.
"The challenges are not the fault of the CAW, nor can we change them at the bargaining table, but what we can do is make sure that we don't exasperate our current labor costs," said Mark Gendregske, DaimlerChrysler's vice president of human resources.
The Windsor assembly plant, which makes the Dodge Grand Caravan, Chrysler Town & Country and Chrysler Pacifica, takes about 27.43 hours to build a vehicle.
The Brampton assembly plant, which makes the Chrysler 300, Dodge Magnum and Dodge Charger, takes about 29.97 hours.
The CAW, which represents 11,600 workers in total at DaimlerChrysler Canada, met with General Motors Canada on Tuesday and Ford of Canada on Wednesday.
In September it will pick a target company for contract negotiations. The resulting agreement will serve as a blueprint for deals with the other two automakers.