Automotive-seating giant Lear Corp. has notified Unifor that it plans to close a plant in Ajax, Ont., where workers who have been on strike since last Saturday rejected a tentative agreement to settle the labour dispute.
The workers, who make seats for the Fiat Chrysler Automobiles NV passenger car assembly plant in Brampton, Ont., rejected an agreement on Monday in what sources said is a dispute mainly over wages.
“Due to the resounding rejection of the tentative agreement by the membership on May 1, 2018, and other recent developments from our customer regarding the future work, the company is announcing a closure of the Lear Ajax plant,” the company said in a memo to Unifor leaders.
A spokesman for Lear, which is based in Southfield, Mich., confirmed that the notification was sent to the union.
About 320 Unifor members work at the Ajax operation.
The plant will be closed “as soon as practical,” the memo to Unifor’s leadership says, but not before the vehicles made in Brampton are redesigned.
Unifor president Jerry Dias said he’s not sure if the memo is a bargaining tactic but said the union will fight to keep the Lear plant open.
Those vehicles, including the Dodge Challenger and Charger, are expected to be redesigned early in the 2020s after Fiat Chrysler agreed in 2016 to a $325-million investment to replace the paint shop in the assembly plant.
Fiat Chrysler is also expected to add output of a crossover vehicle to that plant amid a general decline in North America in sales of passenger cars.
Lear said in the memo that it has withdrawn the tentative offer that was overwhelmingly rejected by the workers on Monday.
Lear shut the factory in 2009, when General Motors Co. closed the Oshawa, Ont., pickup truck plant that was supplied out of Ajax. Lear later reopened the plant in October, 2010, when it won a contract to supply the Brampton Chrysler operation and workers agreed to cut hourly wages by about 40 per cent from what they were being paid when they were making seats for GM.
Lear said last week that it reported record sales, final profit and share profit in the first quarter.
Sales hit US$5.7-billion, up 15 per cent and led to profit of US$353.7-million, or US$5.16 a share.