Workers at Navistar’s Chatham, Ont., plant ratify labor contract

CHICAGO (June 8) — The gust of wind that blew across Southern Ontario yesterday may very well have been a sigh of relief emanating from Navistar International Corp.’s assembly plant in Chatham, Ont.

Nearly 2000 hourly workers represented by the Canadian Auto Workers at the plant ratified a new three-year labor agreement, nearly five months ahead of schedule. The contract is effective immediately and extends through June 1, 2002.

“The new agreement ensures that Chatham will continue as the primary source for our premium conventional heavy trucks,” said Don DeFosset, Navistar executive vice president and president of the truck group.

The Chatham facility produced 27,123 vehicles in 1998, up from 20,250 in 1997. There was speculation that should negotiations become difficult, Navistar might shift some production from Chatham to its year-old plant in Escobedo, Mexico, which is underutilized.

Including a $500 signing bonus, the new agreement offers an average 1.25% increase in wages and a 3% annual increase in pensions over the next three years. Navistar said increased labor costs would be offset by work rule changes that allow a more flexible manufacturing schedule.