(Updates to add Chrysler bargainer's quotes, background)
DETROIT (AFP)--The Canadian branch of ailing U.S. automaker
Chrysler and the Canadian Auto Workers union have not yet reached
an agreement to reduce costs, Chrysler's chief negotiator said in a
statement Saturday.
"After several days of bargaining in good faith, Chrysler and
the CAW have not reached an agreement that closes the competitive
gap with other automobile manufacturers in Canada, to ensure
Chrysler's immediate viability," said Al Iacobelli, Chrysler's
chief bargainer.
If both sides fail to reach an agreement, Chrysler has vowed to
permanently shutter its Canadian operations, putting some 8,000
Canadians out of work.
Both sides "recognize that we are in unprecedented times as it
relates to the global economy and current financial crisis, which
has a direct impact on the automotive industry," Iacobelli
said.
Chrysler "has been very clear in its Canadian government
testimony and position with the CAW: we must 'close the competitive
gap'...immediately, with a goal of not having to affect base wages
and pensions; while contributing to Chrysler's viability with
direct annual savings to the bottom-line in the current year, and
each of the remaining years of the contract," Iacobelli said.
Negotiations began Monday on trimming labor costs before the
deadline to qualify for a bailout of some C$2.5 billion from the
governments of Canada and Ontario province.
General Motors Corp. (GM) reached a deal with its approximately
10,000 Canadian workers on March 8 to freeze wages and pensions,
and reduce holiday pay. The cost savings are estimated to be worth
tens of millions of dollars.
In return, GM has pledged in its restructuring plan to maintain
up to 20% of its North American production in Canada.
Chrysler, however, said the GM cuts, which were to be used as a
template in negotiations with Chrysler, were not deep enough.
GM and Chrysler have so far received $17.4 billion in U.S. loans
following a collapse of auto sales amid a deepening recession, and
have asked Washington for an additional $21.6 billion.
GM is also asking for up to C$7.5 billion in aid from the
governments of Canada and Ontario province, which boasts the
largest auto sector segment in North America.
Chrysler, with some 8,000 assembly, auto parts and office
workers in Canada, has asked Ottawa for a C$1 billion bridge
loan.
CAW president Ken Lewenza told reporters Friday that the union
"is committed to stay" negotiating in Toronto "until March 31 to
continue to tackle the issues that may divide us."
Already, Chrysler has started mapping out its withdrawal from
Canada, local media reported.