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A vehicle exits out of the Ford Windsor Engine Plant on Sept. 19, in Windsor.Bill Pugliano/Getty Images

A last-ditch deal between Ford Motor Co. of Canada and the Unifor union has staved off a strike and yielded an agreement expected to set the template for automotive labour in the electric age.

The three-year contract that covers 5,680 workers was reached around 9 p.m. on Tuesday, just before the midnight strike deadline. A strike would have idled Ford’s Oakville SUV assembly line, and two engine plants in Windsor, as well as parts warehouses in Southern Ontario and Edmonton.

Unifor national president Lana Payne said the deal addresses the issues members raised before the negotiators sat at the table. “We believe that this agreement will solidify the foundations on which we will continue to bargain gains for generations of autoworkers in Canada,” Ms. Payne said in a statement.

Unifor said Ford presented the offer just before midnight on Sept. 18, and it was significant enough to move back the deadline to consider it.

The tentative agreement was reached at a Toronto hotel as a strike by 12,700 United Auto Workers in the United States enters its sixth day. The UAW is striking at three plants owned by the Big Three automakers, and warns more factories will be idled by Friday if contract talks do not progress.

Unifor, which represents 20,000 workers at the Canadian operations of the Detroit automakers, had targeted Ford of Canada in bargaining that was to set a pattern for contracts with Stellantis NV and General Motors.

Unifor picked Ford because it is the closest of the Big Three to switching to electric output, investing $1.8-billion to retool its Oakville assembly plant in mid-2024 to make EVs and battery packs.

The agreement is subject to a ratification vote by Ford F-N workers at dates to be announced.

Unifor and Ford did not provide details of the deal.

Ms. Payne said on Monday pensions and wages were the main hurdles to an agreement. The union was also seeking job security as plants switch to EVs and make new investments in factories.

Experts say the talks were crucial for both sides as the industry moves to electric-vehicle production. Automakers are seeking to manage labour expenses as they spend heavily on new assembly lines and supply chains to build electric vehicles. Autoworker unions are seeking long-term job security as their employers focus on vehicles that have fewer moving parts and require less labour to assemble.

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Ford Motor Company
+0.17%12.14
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General Motors Company
+0.74%39.63

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