Unifor members have ratified a three-year contract with General Motors that includes a $1-billion investment commitment at CAMI Assembly in Ingersoll, Ont., to begin building all-electric delivery vans later this year.
According to a post Monday on Unifor Local 88’s website, 91 per cent of CAMI workers voted in favour of the new contract. Among production workers, 94 per cent supported the deal, while 65 per cent of skilled trades workers did so.
“The stakes going into these negotiations were high with the [Chevrolet] Equinox program ending, and there wasn’t a time during these difficult negotiations that we were not thinking about our members and their families, and we are grateful to all the members for their solidarity as we worked to ensure our plant is viable,” Mike Van Boekel, chair of Unifor’s Master Bargaining Committee, said in a statement.
The ratification caps off a surprise round of bargaining, which occurred months before the prior contract was set to expire in September. Unifor and GM had quietly begun negotiations on Jan. 4 and announced plans for the investment in CAMI on Friday night.
The investment plans, which are contingent upon government support, would allow for production of GM’s new EV600 all-electric commercial van to start later this year. Work at CAMI would begin immediately, GM said.
Unifor Local 88 President Joe Graves said the EV600 would initially be built in an old body shop at CAMI, with production moving to the assembly line after production of the Equinox crossover ends there in 2023. Further retooling to convert the assembly line would take place starting in 2023, likely resulting in a six-month period of temporary layoffs, according to Graves.
Unifor President Jerry Dias said GM is committed to the commercial van program for at least 10 years, providing stability for the plant’s workers.
“Knowing that you got a program that’s going to be there for at least 10 years, very few workers have that kind of security,” Dias said.
It was unclear where production of the Equinox will move, although the crossover is also built at two factories in Mexico. A GM Canada spokeswoman declined to comment, pointing instead to a statement made today by GM Canada President Scott Bell.
“Sometimes, when you are truly ambitious and play as a team, it all comes together,” Bell said. “With [Monday’s] ratification of our new 2021 agreement with Unifor at CAMI, we are charging ahead to make Canada the new manufacturing site for GM’s all-new BrightDrop EV600 fully-electric commercial delivery van.
“GM Canada engineers in Markham and Oshawa were instrumental in the early stages of ideation and testing of this truly innovative solution for the massive global delivery industry.
“Just three days after GM’s unveil of this new business, we identified Canada as the manufacturing home for the EV600. Something really good is happening here.”
The planned investment at CAMI follows a host of investment announcements made last year by the Detroit Three automakers, including GM. The companies have committed to invest nearly $6 billion in their Canadian factories, including for electric vehicle production at Ford Motor Co.’s Oakville, Ont., assembly plant and at Stellantis’ Windsor, Ont., factory.
“It’s part of the whole package of Canada becoming an electric vehicle centre,” said Sam Fiorani, vice-president of global vehicle forecasting at AutoForecast Solutions LLC. “Between Oakville and Ingersoll, there’s a wave of investment going into Canada now to become a centre of excellence for electric vehicles.”
GM, looking to stake a claim in the commercial vehicle segment, is eager to begin production of the EV600 as part of its new BrightDrop commercial EV business, unveiled last week during CES. FedEx, which ordered 500 EV600s from GM, is lined up to be BrightDrop’s first customer.
The automaker sees demand for parcel, food delivery and reverse logistics surging in the next several years. GM, citing the World Economic Forum, anticipates demand for urban delivery to fulfill e-commerce orders growing by 78 per cent by 2030, leading to a 36-per-cent increase in the number of delivery vehicles in the world’s 100 largest cities. (BrightDrop, which will also sell an electric pallet called the EP1, will initially operate in the United States and Canada.)
“The idea of electric, commercial vans is a great one because most of these vans run short routes, which is perfect for electric vehicles because you don’t go too fast, you deliver your products, you go back to the same place and you recharge,” said Fiorani. “And with fewer moving parts, there’s less to fix.”
It was not clear how large full EV600 production volume at CAMI would be or how it would compare with Equinox production. Workers at the plant built 160,858 Equinox crossovers in 2020, according to the Automotive News Data Center.
Graves said GM is “projecting great things” as far as production volume goes, though he said it was too soon to tell how many vehicles would be produced, as that figure will depend on how many orders GM gets from customers in the coming years.
Fiorani said the EV600 on its own would not make up for lost Equinox volume, though volumes at CAMI could rise as demand grows and if GM adds to its line of electric commercial vehicles. According to a Unifor highlights brochure posted on its website Sunday, “other variants” of GM’s all-electric commercial vehicle program are “currently under study.”
“It depends on how quickly the industry shifts in this direction,” Fiorani said. “GM has among the oldest vans in the marketplace. So, allowing the buyers of the Chevrolet Express and the GMC Savannah [vans] to convert over to a modern van with electric drivetrain is of great benefit to General Motors. Their vehicles are almost a quarter-century old at this point.”
Dias said he anticipated employment levels at the plant under the life of the new contract would be comparable to today’s figures, though he said GM could hire more workers in late 2023 and 2024 if “things go well based off the demographics of the plant and based on volume.” About 1,900 workers are currently employed at CAMI, according to the union — 200 are skilled trades.
A Unifor fact sheet said GM and the union “engaged in extensive discussions regarding volume and staffing forecasts and projections” during bargaining. Unifor said it “expressed concern regarding the future staffing needs of the skilled trades workforce” and how it would be impacted by the transition away from the Equinox to the EV600.
According to Graves, initial job projections for skilled-trades members that GM presented to Unifor during negotiations were “quite low.” But he said GM and Unifor are “looking at the possibility” of bringing in new parts for the plant’s stamping shop, which would require skilled trades workers, among other potential solutions.
“We’ve got different things that we hope would bring jobs in-house,” he said.
According to Unifor’s contract highlights, GM and Unifor have agreed to meet 60 days before the temporary layoff that would allow for retooling of the assembly line.
“All reasonable options will be discussed in order to help minimize the impact of the layoff on the CAMI skilled trades workforce,” the union said.
CAMI is on a separate contract from GM Canada’s other unionized plants, which were covered during bargaining in 2020. The new CAMI contract expires on Sept. 17, 2024.
It includes wage increases, $11,250 in bonuses and a two-year reduction in the 10-year wage grow-in period for new hires, among other provisions.
According to GM, the EV600 will have about 402 kilometres of range on a full charge, nearly double what the Ford E-Transit gets. Ford has long dominated the large-van market, though competition is expected to grow as new offerings from GM, Mercedes-Benz and Rivian come online.
“It’s going to be a very competitive space,” said Kristin Dziczek, vice-president of industry, labour and economics at the Center for Automotive Research.
Hannah Lutz contributed to this report.