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Ramp up in U.S. auto strike expected to affect Canadian parts producers

United Auto Workers of local 868 demonstrate outside a Stellantis parts-distribution centre, Friday, Sept. 22, 2023, in Morrow, Ga. (AP Photo/Mike Stewart) United Auto Workers of local 868 demonstrate outside a Stellantis parts-distribution centre, Friday, Sept. 22, 2023, in Morrow, Ga. (AP Photo/Mike Stewart)

Autoworkers in the U.S. ramped up their strike Friday in a move that's expected to have knock-on effects for Canadian parts producers.

The expanded strike saw United Auto Worker members walk out at 38 General Motors and Stellantis parts-distribution centres in 20 states, adding 5,600 workers to the 13,000 who began strikes last week at three Ford, GM and Stellantis assembly plants.

"It spreads the pain around to a new level," said Sam Fiorani, vice-president of global vehicle forecasting at AutoForecast Solutions.

The addition of distribution centres increase the chance of disrupting the supply chain and affecting Canadian parts suppliers, he said.

"As the days go by, parts suppliers are more and more hampered, and it gets worse as the parts suppliers themselves are smaller. So the smaller tier two and tier three suppliers will really get hurt."

Canadian companies operating in the U.S. have already been affected by the strike.

Aurora, Ont.-based Magna International Inc. confirmed that LM Manufacturing, a joint venture they own 49 per cent of, has temporarily laid off about 650 employees because the plant supplies seats to a Ford Bronco plant that has been shut down.

Ford however was spared from the expanded strike on Friday as UAW president Shawn Fain says the union has had progress in negotiations with the company.

In Canada, Ford averted a strike by reaching a tentative deal with Unifor on Tuesday that members will vote on this weekend with results expected on Sunday.

Unifor national president Lana Payne said the agreement, expected to set a blueprint for contract negotiations with GM and Stellantis, addresses key issues such as wages, pensions and the electric vehicle transition.

This report by The Canadian Press was first published Sept. 22, 2023.


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