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updated: 10/12/2017 12:42 PM

Canada union head: GM threatens to move production to Mexico

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DETROIT -- The president of the Canadian auto workers union says General Motors is threatening to move production of the Chevrolet Equinox small SUV to Mexico as a strike continues at an Ontario factory that makes the same vehicle.

Unifor President Jerry Dias says GM has declared war on Canada with the threat. A GM official with knowledge of the bargaining says they're still talking but are at impasse over job security.

About 2,500 workers at the plant west of Toronto went on strike Sept. 17. The union wants GM to designate the plant as the main Equinox producer.

Here's what you need to know about the strike:

- GM told the union on Wednesday that it's ramping up production of the hot-selling Equinox at two Mexican plants, according to Dias. Production at the plant in Ingersoll, Ontario, will wind down if Unifor Local 88 continues its 25-day-old strike, he said.

- The GM official said the company is preparing to make more of the SUVs at two factories in Mexico but hasn't made a final decision. It has invested $800 million at the Ingersoll plant to make a new version of the Equinox, which is an assurance that GM is serious about keeping work there, he said. He requested anonymity because GM doesn't normally speak publicly about negotiations.

- GM doesn't want to designate one plant as the main producer of a vehicle because it needs flexibility in case market conditions change, the official said.

- Dias said GM is taking advantage of low pay in Mexico, and he blamed the spat on the North American Free Trade Agreement: "Mexican workers are being exploited and, as a result of that, we're losing hundreds and hundreds of thousands of manufacturing jobs in Canada and the United States."

- Dias has reason to fear that production could be moved. GM shifted production of the Chevrolet Camaro sports car from Oshawa, Ontario, to Lansing, Michigan, two years ago. The United Auto Workers union in the U.S. generally is seen as being more cooperative with companies than Unifor.

- GM is running short of supply on the Equinox, which is the hottest-selling part of the U.S. market right now. Sales are up 22 percent through September and GM has only enough of the SUVs on dealer lots to supply 41 days of sales, according to Wards Automotive. Automakers like to have 60 days' worth on hand to satisfy demand and give customers a variety to look at.

- The two Mexican factories take away leverage from Unifor, which is trying to solve problems with NAFTA in contract talks, said Kristen Dziczek, director of the Industry, Labor & Economics Group at the Center for Automotive Research, a think tank in Ann Arbor, Michigan. "The problems of NAFTA are not problems that can be solved at a local union bargaining negotiations," she said.

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