Canadian Auto Contract Talks Begin

The Canadian Auto Workers union launched contract negotiations with Chrysler and General Motors on Tuesday and will open talks with Ford today.

Automakers claim Canada has become one of the most expensive places in the world to build vehicles. They cite the country's strong currency and a labor contract that lacks cost-cutting concessions the United Auto Workers union has made in the U.S. Those include a two-tier wage system and the substitution of profit sharing for pay raises.

CAW President Ken Lewenza insists the union opposes such concessions. But he says it would consider stretching the system under which new hires start at lower wages that are elevated to full-scale pay over six years. Lewenza also hasn't ruled out profit sharing and declares that preserving jobs is more important than pay gains.

At least some the carmakers are expected to dangle the promise of future investments in exchange for concessions. Local CAW leader Chris Buckley tells Reuters that GM has raised the possibility of delaying the closing of an Oshawa, Ont., assembly line currently scheduled for next June. Buckley insists the union won't make concessions to keep the line, which employs 2,000 workers, open longer.

Talks will pause next week during the CAW's annual convention, during which union leaders will stand for re-election. The existing contracts expire on Sept. 17. But Lewenza says he aims to settle all three pacts by Sept. 16, thus avoiding a strike.