Thursday, January 24, 2008

More Ontario manufacturing jobs bite the dust

Two more plants are closing in Southern Ontario - Ledco in Kitchener, and Dana in St. Mary's near Stratford.

But Dalton says, Don't worry - Be happy. Spend that money you don't have.

Actually, I'm not sure that governments can do very much about this situation. In the case of Ledco, you have to wonder about the integrity of a union that would rather see people lose their jobs than accept a pay cut.

"We were willing to take the pay cut and try our damnedest," he said. "I'd rather have a job and fight tooth and nail for it, even if it's for six months."

(Elgin) Dezell said he is worried he will lose his house now that he has no job...

Well, Mr. Dezell, about that house. I may have more bad news for you.

* * * *

Friday Update
: Ledco just ran out of money - Record:

...Reached in Ottawa yesterday, Arends said he was "very, very disappointed" that the company could not convince the Canadian Auto Workers Local 1524 to consider a plan to cut wages by 25 per cent.

Unionized workers earned an average of $25 an hour. The company also asked its unionized workers to accept a 20-per-cent benefits cut and a reduction in vacation days.

Arends said the company made it clear to its employees that it couldn't compete with U.S. competitors if the dollar continued to trade near parity.

"Customers were putting extreme pressure on us on pricing," he said. "We got to the point where the bank said, 'No more money.' "
Non-union employees had already accepted the 25-per-cent wage cut, Arends said..

...The CAW has a no-concession policy on wages and benefits...


Anonymous said...

This will hit St. Mary's hard. That town's school board is in the midst of plans to build a new school there because they had to close one that's prohibitive to repair.

Wait for it's Mike Harris's fault, or Harper doesn't treat Ontario equally.

Swift said...

You've got to look at the bright side. With this big increase in revenue the cities will stop whining that they don't have enough money!

Lyle said...

Elgin Dezell, a 30-year veteran of the plant, said he was in favour of accepting a wage cut to save his job, but his position was at odds with his union. "The company gave (the union) until 3 o'clock in the afternoon to change their stand," he said. "We were willing to give the company something, but the union would not allow that. That puts us out on the streets."

Bad news, all the union wants is your money. They really do not care for common sense. The leaders only want your dues so they can live high-off-the-hog while its members get little or nothing in return. This case proves the point. Some workers were willing to take a big cut in wages, but the union didn't want that so they left the workers high-and-dry looking for work. Will they get something in return for all the years paying their dues faithfully? Probably not.

The past few days of the stock market "fall" will hurt all Canadians and the rest of the world. This has little to do with governments, though they will get the blame. Just watch the next election, the Liberals and NDP will blame the Conservative government for the loss of jobs.

Just a thought: I wonder if the employees cold buy the plant and make it work without the union. I heard it worked before, perhaps it will again. It is a sad thing to see skilled workers lose their jobs because of unions, particularly when a reasonable offer was made but rejected by their union. As for the workers who lost their job, I think it is comparable to news of a death of a friend. Sad it had to come to this when workers were willing to take a pay cut.

BTW I am not against unions, in the past they served an important part of our society by bring standards and safty to forefront.

paulsstuff said...

Allow me to weigh in with my own "knowledge".

I've been a CAW member for 32 years and a Chrysler worker for 22 years. Here is how I see it, and I'll add some facts most do not know.

1. The Big 3 actually produce more cars with less people than the imports. The discrepancy lays in the fact retiree costs are included into cars currently being built. The automakers say this makes them less efficient. I agree with the fact that it does increase their costs but should not be included when costing out manhours per car.

2. In the early eighties Chrysler went through some dire financial consequences. The union members gave up huge pay and benefits in order to allow Chrysler, and their jobs to survive. The union was against the concessions but agreed when management took similar pay decreases to set an example. What was never told to the union was all management concessions were "retroactive" and all pay given up was paid back on top of lucrative bonuses. It took more than 12 years for the workers to get back to where they should be.

3. Move ahead to 2008. Buzz Hargrove and senior CAW management now must realize times have changed, but refuse to. The recent negotiations by the Big 3 in the U.S. saw all current workers maintain their current rate of pay, which is quite good. All new employees will make roughly $15 an hour, with a less lucrative pension. Hargrove has already told Chrysler workers to start saving up for a strike, as the union refuses to have a two-tier pay rate(two-tier healthcare?see the similarities).

4. If Hargrove thinks he can win this and still have the companies putting new vehicle production into Canada, he is to put it nicely, a moron.

5. The whole basis for a union is that democracy wins, and the fact the union refuses to allow the workers to vote on the concessions is disgusting. The majority should decide their fates, not some union rep who will quickly be appointed to a union position when the plant closes.

7. Workers at my plant in Brampton recently agreed to changes that cost the workers between $7000 to $10000 a year in pay. For those who say we are greedy, keep in mind stuff like that never gets reported.

8. As for those who think its an easy job, keep in mind you do a vehicle roughly every 45 seconds, in excess of 500 cars in an 8 hour day. Here is an example of a job I did for ten years.

-Pick up a tire and place on the car when its moving(tres weigh 50-70 pounds)
- Get 5 lug nuts and place on studs
- Install hub cap if vehicle is so equipped.
-pick up rear tire and replace previous step. Kepp in mind this is all done in a 5 foot long area in 47 seconds.
- In an eight hour shift, thats over 1000 tires, 10,000 lug nuts, and between 200-400 hubcaps. Multiply 1000 tires by 60 pounds and thats what you are moving in an eight hour shift.- Did I mention this is one of the better jobs on the line? Add in auto workers face one of the highest rates of both repetitive and strain injuries and its not as rosy as everyone imagines.

To sum it all up, the decision on concessions should rest with the workers, not union brass. Then again, we constantly hear the rant against "two-tier" health care as our system continues to deteriorate. Don't you just love socialists?

nomdeblog said...

Paulsstuff “I agree with the fact that it does increase their costs but should not be included when costing out manhours per car.”

But you would agree it has to go into the price .. the money to pay the retirees has to come from somewhere … right? And the big three are dropping themselves out of the market because the value isn’t; there .. GM has fallen from 50% market share to under 30 and Toyota has replaced Ford as number 2.

GM has fallen in capital value over 5 years from over $50 billion to only 13 billion. Toyota has seen its value soar to $160 billion.

Toyota is not unionized, GM and Ford are. Toyota is heading for dominance, Why? How?

Paulsstuff , your post is very thoughtful ; thanks, it is good to hear stuff the way it is from the front lines … good luck ..for all our sakes … automotive is a large part of the Ontario economy.

paulsstuff said...

"Toyota is not unionized, GM and Ford are. Toyota is heading for dominance, Why? How?"

Simple. Well run by management, good vehicle design, etc.

Many of the problems the Big 3 experience are a result of both incompetence and greed. Management routinely flouts quality for production output. Much of this is a result of upper-management. Instead of maintaining the status-quo, major changes need to take place. Providing incentives based on increased sales and quality rather than bonuses for the number of cars "shipped" for example.

Here is a good example. A number of years ago workers on the line noticed a defect in the parts stock. Management was called and the workers should the upper-management the problem. Managements reply was basically, F#@* it, get this line running and use the parts you have. A few years later they were forced to do a vehicle recall that cost them millions of dollars, all because management wanted their bonuses for getting their "numbers" for the shift.

Trust me, their are many more examples.

Joanne (True Blue) said...

Paulsstuff , your post is very thoughtful ; thanks, it is good to hear stuff the way it is from the front lines … good luck ..for all our sakes … automotive is a large part of the Ontario economy.

I agree. I've learned a lot too and have new respect for the automotive workers.

I've been trying to talk Paul into starting his own blog, but he'd rather comment here, which is just fine by me. ;)

Canuck1955 said...

Well written Paulsstuff.
I was a union member in the '70s. When I was laid off for about the 5th time I never went back. Promise3d myself to never work in a union shop again.


I drove by the strikers at Ledco today. I felt sorry for them, real people with real problems.

However, no union people will EVER get me to HONK for support.

This biggest problem with unions...union leaders.

Keep supporting Buzz boys and girls!!!

Anonymous said...

Paulstuff, one thing I want to agree with you about is that auto assembly is a brutal job, beyond the experience of ordinary people who work at regular jobs. It is backbreaking (or armbreaking) work, and many people are simply not physically capable of doing it for long.

There are some things the human body was not designed to withstand, and relentless non-stop moderate intensity manual labor for hours at a time is probably on that list . The auto makers have tried to squeeze every last bit of "efficiency" out of their workers, but have only succeeded in breaking many of them down physically. That's not efficient in the long run.

When the story of the collapse of the North American auto industry is written, it will be a tale of twin villains - a failure of vision in both corporate and union leadership.

liberal supporter said...

Thanks paulsstuff.

I think autoworkers are worth every penny they are paid. I've always thought there need to be better laws on union governance, like all significant votes should be by secret ballot. I think life without unions would be much worse than life with unions, but there needs to be a more of a balance of power. I read once that German companies have the union somehow involved in the corporation and the union benefits when the company does well. Something like that.

I've heard the anecdotal story of the "big button" in Toyota lines that anyone can use to stop the line. Management is said to first rush down to the line and praise whoever pushed it, then they get everyone trying to solve the problem before restarting. It seems solving a quality problem earns more kudos than production itself. I suspect that is overstated, but they do have that reputation.

It seems the domestics have a "can't do" attitude. I've often asked a car dealer friend why the domestics have no hybrid vehicles (now there are a few, but they are late to the party). Then we hear huge costs to improve mileage. GM is claiming it will cost $6000 a vehicle to meet the new US fuel efficiency standards. It sounds more like they just don't want to, rather than they'll do their best, though I don't know for sure. The "can do" types of people just sound different.

I refuse to buy an import. I think the claimed lower labour costs in other places have a lot to do with the exchange rates. Like people pay less for their food and shelter in other places. We have higher energy costs due to our latitude, but that doesn't account for the claimed cost differences.

paulsstuff, what can be done to smarten up the domestics' management?

Möbius said...

I read once that German companies have the union somehow involved in the corporation and the union benefits when the company does well. Something like that.

Not quite. The German unions benefit when the corporation does well, and even when they don't. They seem to have more stat holidays than we could ever imagine, and it's darn near impossible to get rid of workers. Corporations are wary of hiring in good times, knowing they can't downsize in bad.

Möbius said...

I've heard the anecdotal story of the "big button" in Toyota lines that anyone can use to stop the line. Management is said to first rush down to the line and praise whoever pushed it

I've met several Toyota engineers, and they treat quality as a personal religion. To them, nothing is more important. Workers are team-members and contribute to the final product.

liberal supporter said...

The German unions benefit when the corporation does well, and even when they don't.

I heard this tale maybe 20 years ago, and can't remember where I heard it. It was something about a union rep on the board of directors, and the union was somehow responsible for the company's performance. I'm hoping someone else has heard this and knows more about it.

I was quite shocked to learn that here a union can have what amounts to status (like a mortgagee might have) on the title to a piece of land. You own a factory with a union, and if you sell it the union remains the union for the business. It sounded like it would be true even if the new owner starts a different business. I think you have to close and do no business for at least a year. I can understand it preventing simple paper transfers of businesses for the purpose of union busting, but the way it was presented it sounded excessive to me.

paulsstuff said...

Good posts by all. L.S. made an excellant point about the relationship between German companies and the unions. German union workers receive some of the best working conditions in the world, holiday time as an example. The differance is the company and union treat each other as partners, whereas here the company and union are both guilty of its us against them mentality.

Many of the problems here are because of managements thinking that they know better than the ones actually building the cars. Doing a repetitous job allows the worker to see ways and ideas for better fit and finish, as well as quality and efficiency. For years the companies had a system in place where if a worker came up with a documented and proven idea that employee would receive a type of finders fee bonus. For example, an idea that saves the company $1 million a year, the worker would receive a substantial bonus. Everyone wins. The Big 3 abandoned the idea. Workers are now reluctant to give ideas. In my case some co-workers and myself came up with an idea for a hydraulic lift to reieve some of the lifting of tires and make the job more efficient and safer. Imagine my surprise a few weeks later upon learning an i.e.(industrial engineer), had stolen the idea as his and received a sizeable bonus and promotion. The lift is now used in plants throughout North America.

There are rumors going around at work now of a sizeable buyout package for workers with 20+ years of service. Hargrove has flatly refused to discuss it, even though if put to a vote by the membership it would easily pass.

For anyone wondering who I am, I was shown on CTV and CBC during contract negotiations years ago. We were less than 48 hours away from the strike deadline and Hargrove came out in the media saying we would strike if Chrysler never made Magna unionized. Everyone was pissed and as we were leaving work the news stations had cameras set up at the turnstile. I basically called Hargrove out and said we would cross the picket line if he striked over Magna. Hargrove backed off and has had a little snit ever since.