May 15, 2008 / 1:07 PM / in 10 years

GM reaches Canadian Auto Workers deal

DETROIT (Reuters) - The Canadian Auto Workers union and General Motors Corp have reached a tentative agreement on terms for a new contract after bargaining through the night, a spokeswoman for the union said on Thursday.

“We have a tentative agreement with GM,” CAW spokeswoman Shannon Devine told Reuters, adding that the union was making arrangements to brief reporters on the pact.

Talks with privately held Chrysler LLC are continuing, said Devine, who was speaking by phone from Toronto.

Terms of the proposed GM contract were not immediately available.

CAW President Buzz Hargrove had said late Wednesday that he expected to reach new contract agreements with both automakers by Thursday that would follow the pattern set by a now-ratified three-year deal with Ford Motor Co.

The bargaining affects contracts for over 22,000 Canadian auto workers at GM and Chrysler.

Part of the CAW deal with GM will include buyout and early retirement offers for some 1,200 union-represented workers at a Windsor, Ontario, transmission plant GM plans to close in 2010.

GM announced plans to close that 45-year-old plant on Monday, a decision Hargrove said had come as a shock although union leaders have also said they believe dwindling market share left GM with no other choice.

Hargrove said on Wednesday night that the two sides had reached a “close-out” agreement for the Windsor plant.

The CAW’s current contracts with GM and Chrysler do not expire until September 16, but the union ratified an early agreement with Ford on May 4 and pushed for quick deals with GM and Chrysler that follow the Ford pattern.

The three-year Ford contract, covering about 9,000 workers, freezes base wages, cuts a week of vacation and avoids any cost-of-living pay increases until the end of 2009 but avoids the two-tier wage system the Detroit automakers have instituted in their U.S. factories.

Hargrove has said the CAW is seeking product investment pledges from GM and Chrysler that would also parallel assurances Ford gave the Canadian union.

The talks come at a difficult time for the Detroit-based automakers, which have been cutting production and jobs in North America in a bid to return to profitability.

The CAW began negotiations with GM last Thursday and with Chrysler on Monday.

Reporting by Kevin Krolicki, editing by Gerald E. McCormick and Dave Zimmerman

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