Strike 2: Strike at Supplier TRW Halts Chrysler Minivan Production

Strike 2: Strike at Supplier TRW Halts Chrysler Minivan Production

By Joseph Szczesny

WINDSOR, Ontario — Strike fever is spreading in the auto industry.

On Thursday, 175 members of Canadian Auto Workers (CAW) Local 444 employed at a TRW Automotive plant in Windsor, Ont., went on strike after contract negotiations reached an impasse.

The TRW plant supplies suspension frames used on the 2008 Chrysler Town & Country and 2008 Dodge Grand Caravan. Chrysler’s Windsor assembly plant, which produces the minivans, was forced to shut only hours after the CAW strike began.

Chrysler also is facing the potential shutdown of its truck production due to parts shortages created by a strike at American Axle and Manufacturing Holdings Inc., a Detroit-based manufacturer of axles and related parts. That strike started Tuesday after bargaining over economic issues broke down.

That strike almost immediately has forced General Motors to close its Pontiac, Mich., plant, which builds the 2008 Chevrolet Silverado and 2008 GMC Sierra because of a shortage of axles and related parts.On Friday, GM said it was closing three more truck plants — Fort Wayne, Ind.; Flint, Mich.; and Oshawa, Ont. — due to parts shortages. Those three plants employ nearly 10,000 workers. GM has two more truck plants — one in Silao, Mexico, and one in Janesville, Wis., — that could be vulnerable to parts shortages from the strike as well.

Foreshadowing Big Three–CAW Negotiations
Ken Lewenza, president of CAW Local 444 in Windsor, said in a note posted on the union local's Web site negotiations to establish a collective-bargaining agreement for broke down over economic issues. Employees earn an average $11.25 (Canadian) an hour, significantly less than the average manufacturer in Ontario pays, he said.

“(The) CAW is making preparations for a lengthy strike but has advised the TRW management team that we are available day and night if constructive negotiations can commence for the purpose of bargaining a reasonable resolve,” said Lewenza. His union local also represents workers at Chrysler’s Windsor minivan plant.

The TRW strike also serves as a warning to GM, Ford and Chrysler by the CAW. All three automakers must negotiate new labor contracts with the union this year as the current contract expires in the fall. CAW President Buzz Hargrove has said in several forums recently he wants no part of the concessions the automakers extracted in the United States from UAW in 2007.

For their part, the Big Three have warned the rising value of the Canadian dollar has made manufacturing in Ontario more expensive and means they need  “competitive” agreements with the CAW.

And if tensions weren’t already running high based on economic realities, word that Daimler AG last year paid $20.7 million in bonuses to Chrysler Vice Chairman Tom LaSorda has only added fuel to the fire. The bonuses were paid in connection with the purchase of the automaker by private-equity firm Cerberus Capital Management. Generally popular with union workers, LaSorda is a former UAW member himself and is Chrysler's top union negotiator.

Though the posturing has already begun, negotiations ensue in earnest beginning mid-summer. The CAW’s contract with the Detroit automakers expires in mid-September.

Michelle Krebs:  is Editor-in-Chief of AutoObserver.com. Follow @AutoObserver on Twitter.