Canadian Auto Workers are negotiating for their new contract. 5 days to go and the sabres are rattling. They may select one of the big three in Canada for strike action. My prediction is Ford (NYSE:F).
General Motors (NYSE:GM) is still weak after their bail out and building plants in China. The big plant on Oshawa is on borrowed time and probably will close in a few years. In the meantime the Oshawa Works are a shadow of their former glorious past. GM is looking for reasons to padlock the place.
Chrysler is controlled by Fiat (LSE:F) which is run by the Agnelli family. The Agnelli family would just sip proseco and act like there was nothing wrong. Picket lines mean nothing. The Canadian Auto Workers would not know how to fight someone like the Italian Kennedy family.
lSo it would be Ford. Large presence. Public shareholders who would take pain. Just enough non government bailout fat to be abused. Like a shark to fresh red meat. Some unionists see the possibility for leverage.
But here are the problems. Managements are very aware of cost structures and the ease of moving offshore. So if its strike first be prepared for a long one with an eventual closure in favour of a right to work state or even something in an underdeveloped country that cannot spell mandatory union dues. Also Canadian foreign exchange advantages have long dried up. Canadian labour is very expensive.
George Gutowski writes from a caveat emptor perspective. Follow him on twitter @financialskepti
- Canadian auto strike would hit US quickly (sfgate.com)
- CAW: Prepare For A Strike (huffingtonpost.com)
- Canada auto union offers wage cuts, weighs strike (sfgate.com)