US automaker Ford Motor Co will shutter one of its manufacturing plants in Canada in 2011, a move that will cut 1,400 jobs, the Canadian Auto Workers (CAW) said on Friday.
As part of a cost-reduction agreement between the company’s US headquarters and the CAW, the plant in St Thomas, Ontario, will close in the third quarter of 2011, the powerful union said in a statement.
About 1,400 employees will be dismissed, CAW spokeswoman Shannon Devine told reporters. Canadian media put the number of jobs to be eliminated at 1,600.
As part of the tentative agreement the union said it obtained a commitment by the US automaker to keep at least 10 percent of its North American production in Canada.
“During the negotiations, Ford threatened that if we didn’t come to an agreement, the company would begin shifting investment out of Canada,” CAW president Ken Lewenza said.
“In today’s globalized economy where companies attempt to bypass community commitments, it’s crucial that we don’t allow this to happen,” Lewenza said.
The agreement, which expires in September 2012, is expected to be voted on and approved today by the CAW’s 7,000 Ford workers in Canada.
The St Thomas plant produces the Ford Crown Victoria — a model routinely chosen by US police forces and New York taxis — as well as the Mercury Grand Marquis.
As part of the new deal, the CAW agreed to a reduction in holidays and a requirement for workers to contribute to the company’s pension fund at the rate of C$1 for every hour worked, Devine said.
The automaker committed to funding and opening a center to assist workers unemployed after the plant closure.
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