Canadian supplier dispute could shut Chrysler plants
Bradford Wernle
Automotive News
March 18, 2009 - 1:24 pm ET
Production at several Chrysler LLC factories in North America could be shut down as early as next week because of a standoff at a Windsor, Ontario, parts plant.
About 80 workers occupied a Canadian parts plant Tuesday in an effort to prevent Chrysler from removing its tooling, according to
The Windsor Star. The workers say they want to receive termination and severance pay from the supplier, Aradco Management ULC, which makes motor mounts and other metal parts for Chrysler. The automaker accounts for 99 percent of Aradco's work, the newspaper reported.
Chrysler spokesman Dave Elshoff said that if the standoff is not resolved by the end of this week, it could threaten production at several North American factories next week. Elshoff said he did not know what plants might shut down.
"There's an illegal blockade keeping Chrysler from picking up its parts and tooling," Elshoff told
Automotive News. "We'd like to take our tools and re-source the business with a viable supplier partner."
Chrysler and Aradco's U.S. parent company, Catalina Precision Products Inc., disagree over who owes whom money.
Elshoff said Aradco owes Chrysler money for steel it had purchased.
But Dave Domzal, a lawyer representing Catalina Precision Products, told
The Windsor Star that Chrysler owes about $2 million to Aradco.
Domzal said Aradco and Catalina were in discussions with Chrysler earlier this week when the automaker abruptly terminated its contracts. The next day in Toronto, Chrysler obtained a court order allowing it to move its tools to another company.
Chrysler was "basically telling them they were putting them out of business," Domzal told the newspaper.
Chrysler attempted to end the blockade when it offered $205,000 to about 80 workers. But workers rejected the offer, claiming they are owed more, the
Star reported.
Gerry Farnham, president of Local 195 of the Canadian Auto Workers, said the employees' "resolve is pretty strong,"
The Windsor Star reported. "It's a shame we have to do this."
Police officers had gathered outside the plant, but workers prevented them from entering, the newspaper reported.
A rally was scheduled for today at 3:30 p.m. outside the Aradco factory.
The dispute comes at a sensitive time for Chrysler and Canada.
Last week Chrysler co-President Tom LaSorda -- a Windsor native -- told a committee in the Canadian House of Commons that Chrysler's Canadian operations will be jeopardized if the company doesn't get wage concessions from Canadian workers and a $2.3 billion loan from the government.
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tooling may take chrysler out of canada
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