Workers strike at International plant in Chatham; production shifts to Mexico

CHATHAM, Ont. (June 3, 2002) — About 800 workers at Navistar International’s Chatham, Ont., truck plant went on strike at 12:01 a.m. Monday after negotiators failed to reach an agreement on a new labour contract.

The workers are represented by the Canadian Auto Workers Local 127. A spokesman for the CAW told Dow Jones Newswires that the company is “demanding huge concessions” from the union, including wage and benefit cuts.

International responded by shifting production to a plant in Escobedo, Mexico. Flush with orders in advance of tighter emissions requirements coming into effect Oct. 1, the Chatham plant had been making 39 trucks a day at the time of the strike.

In April, International said it may close the plant unless it could cut $28 million in fixed costs there. At that time, the company had reached only half the target.

Rumours of a plant closure or severe output cutbacks also swirled during the last round of labour negotiations in 1999. During that time there were reports that in the event of a closure in Chatham, production would move to the Escobedo facility.