With Canada's Cost Edge Virtually erased by its rising dollar, the Canadian Auto Workers union will emphasize productivity in its ongoing pursuit to entice investment in Canadian plants.
“We still have some advantages, but there's no question that the gap narrowed,” CAW President Ken Lewenza tells Ward's from the union's convention in Quebec.
Lewenza, reelected to a 3-year term as head of Canada's largest private-sector union, also is keen to improve the public image of auto workers and unions.
For the better part of four decades, Detroit auto makers have benefited by importing Canadian-made vehicles and components because the exchange rate favored the loonie by up to $0.60.
But as the global recession took shape, the U.S. dollar occasionally has hovered at or below par. Recently, the loonie has held steady near $0.90, compared with the greenback. Anything above this level generates “stressful” conditions for Canada's auto industry, Lewenza says.
A $6-per-hour advantage created by the country's national health-care program also was weakened with the establishment in the U.S. last year of the Voluntary Employee Benefits Assn.
Administered by the United Auto Workers union, the VEBA is designed to relieve Detroit auto makers of annual retiree health-care obligations that routinely run into eight figures.
So the CAW, which represents more than 34,000 workers at Canadian subsidiaries ofCo., Group LLC and Motor Co., is trumpeting its members' efficiency gains.
The 2008 Harbour Report says plants with CAW workers required 20.4 hours to assemble a vehicle, compared with 21.7 hours for a non-union Canadian plant; 22.1 hours for a UAW plant in the U.S.; and 25.2 hours for a non-union U.S. plant.