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Canadian auto industry braces for impact as U.S. workers strike

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A strike by autoworkers across the border is expected to impact the sector in Canada with the industry in both countries being deeply integrated.

With operations and suppliers in Canada and the U.S. being reliant on components from both sides of the border before they are assembled into a finished vehicle.

Due to this inherently integrated nature, Sam Fiorani, vice president of Global Vehicle Forecasting at AutoForecast Solutions LLC, says interruptions on the Canadian end of manufacturing can be anticipated if the strike continues.

Fiorani says, “With Unifor negotiating at almost the same time, It’s unlikely that the UAW would target anything that would significantly impact Canadian suppliers or factories, just so that Unifor could have the unique strength to target its own plants.”

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The Canadian union is in bargaining with Ford Motor Co. ahead of its contract expiry on Monday. Unifor says it hopes a deal with Ford can serve as a blueprint for workers at the other automakers.

Should a deal not be reached, the Canadian union could announce a strike.

Around 13,000 U.S. workers went on strike Friday at three major auto companies, Ford, General Motors and Stellantis after they failed to reach a new contract.

Union leaders say that the automakers could not bridge the gap between union demands and what the companies were willing to pay.

In 2007, workers gave up cost-of-living raises and defined benefit pensions for new hires ahead of the Great Recession. They say it’s time to get these back as the companies continue to make huge profits and CEOs’ are raking in millions.

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Additional demands from the union include a 40 per cent raise over 4 years, retiree health care coverage, limits on forced overtime and job protections.

Members of the United Auto Workers union could be seen picketing at a General Motors assembly plant in Wentzville, Mo., a Ford factory in Wayne, Mich., near Detroit, and a Stellantis Jeep plant in Toledo, Ohio.

“Workers all over the world are watching this,” said Liz Shuler, president of the The American Federation of Labor and Congress of Industrial Organizations.

This marks the first time in the union’s 88-year history that all three companies went on strike simultaneously.

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The strike in the U.S. comes as Canadian auto workers are also in negotiations of their own. There’s a strike deadline on Sept. 18th for over 5,000 unionized workers at Ford Canada.

Unifor– which represents auto workers in Canada– says it is looking for higher wages and better pensions.

Professor of labour studies at Brock University, Larry Savage, says the strike in the U.S. may prove helpful for the Canadian union

“The UAW’s militancy is likely to have a positive spillover effect for Unifor, in the sense that it is going to bolster that union’s bargaining demands north of the border. I think the UAW is firmly in the driver’s seat here. As much as Unifor’s leadership insists they’re forging their own path, I think there’s no question that developments in the United States will have a significant impact in Canada and shape bargaining outcomes in Canada,” Savage said.

According to the Canadian Vehicle Manufacturers’ Association, vehicles are the second largest Canadian goods export by value.

Savage also mentioned the auto sector is going through an electric vehicle transformation — which is also putting pressure on car companies.

“The Detroit three, they don’t want to lose market share to other auto companies, so it’s very important for them to secure labour peace on both sides of the border,” Savage said.

However, Savage says disruptions in the U.S. due to the strike will certainly create disruptions in Canada as well.

“But that’s kind of the point, right, strikes are designed to disrupt business as usual, they’re designed to apply pressure on an employer to reach a negotiated settlement. It will be interesting to see what the outcome will be,” Savage said.