GM Canada cites dollar difficulties while GM US speaks of confidence

Two very different stories from GM Canada and the US parent company. In the US, GM has announced that it will invest $2 billion in seventeen plants, creating or preserving 4,000 jobs. GM Chief Executive Daniel Akerson spoke of being "confident about demand for our vehicles" in a statement.

Since emerging from bankruptcy and a government bailout of $52 billion in 2009, GM said it has invested $3.4 billion in its U.S. plants, creating or retaining more than 9,000 jobs.

GM's focus on building cars is shown by last week's announcement to invest $131 million revamping a Kentucky factory for a new version of the iconic Chevrolet Corvette sports car. The Kentucky announcement is part of the $2 billion plan.

GM will also invest $204 million and retain about 250 jobs in its Toledo, Ohio plant to make a new eight-speed automatic transmission. The plant employs more than 1,600 people, including more than 1,450 hourly workers and makes transmissions for vehicles including GM's No. 2 selling Chevrolet Cruze.

General Motors of Canada president Kevin Williams, however, warned Monday that the company is in a “difficult position" because of Canada's rising dollar and must drive manufacturing and labour costs down again.

In 2009, the Canadian Auto Workers accepted concessions to remain competitive with their American counterparts and help save the company, but the dollar’s steady rise has widened the wage and benefit gap again. GM and the United Auto Workers agreed on profit sharing more than a decade ago, but the CAW has steadfastly rejected it. The union argues profit sharing would erode and weaken the existing wage structure and expose workers to financial instability in downturns.

“We have no interest in it,” said CAW president Ken Lewenza.

The company will propose profit sharing again next year to align its interests better with workers, said Kevin Williams.

GM remains one of the country’s biggest manufacturers and employs about 9,000 workers despite closing major plants and eliminating thousands of jobs during the last decade.

“What we want to be able to do is make sure our workers share in the profitability of General Motors,” Williams said. “As General Motors does well, we want our employees to do well. That’s how we structure it with our salaried workforce.

“We want the same (U.S. profit sharing) for Canadian workers...We’re working really hard to make people understand that General Motors needs to be successful. And as GM is successful, we’re good to share that profitability with our workers.”

The UAW is pressing for improvements in the profit sharing formula in contract talks later this year with the three Detroit-based automakers. The formula generated about $4,000 for GM workers this year.