For the first time in at least a couple of decades, the union representing about 17,000 auto workers in Canada will go into contract talks this fall with real bargaining power.
Why? Well, to borrow an oft-cited-but-suspect quote attributed to the late Chinese Chairman Mao Tse-Tung: "There is great chaos under heaven — the situation is excellent."
Excellent, perhaps, for Unifor, the union whose contract with automakers expires in September. But maybe not so great for the automakers on the other side of the table trying to get another multiyear labor contract in Canada ratified.
Factors well outside the control of the automakers or the union — vehicle shortages after COVID-19-related production suspensions and stronger-than-predicted retail demand, as well as implementation of a new North American trade agreement — have joined to make a potential disruption of production even more unpalatable than normal for Detroit 3 automakers.
Yet despite Unifor's increased bargaining power, its primary goal in these talks will remain the same as it has been for at least the last two decades: preservation of Canada's automotive industry.
Detroit 3 production in Canada — already well below its peak — is projected to fall an additional 27 percent by 2023, according to an analysis this year by the Center for Automotive Research in Ann Arbor, Mich. Indeed, General Motors is but a bit player in the Unifor talks, since it has fewer than 2,000 of its workers and no assembly plants under the expiring contract in Canada. But for Unifor workers at Ford and Fiat Chrysler Automobiles, these talks will be aimed at securing future products and a renewed lease on life for Ford's Oakville Assembly and FCA's Brampton and Windsor plants.
A robust and ongoing Canadian automotive sector is good for all of North America. Labor and operational costs may be moderately higher in Canada than in areas of the U.S., and certainly higher than those in Mexico. But any difference is a rounding error compared with the revenues generated by the automakers' Canadian factories and dealer partners.
Both Unifor and the Detroit 3 should go into these talks with a common goal: to revitalize automaking in Canada. If they do, they are sure to reach an amicable agreement.