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Cars are loaded on trucks for shipping at the Ford Oakville Assembly plant on Sept. 8, 2020.Glenn LOWSON/The Globe and Mail

Contract talks will kick off between Fiat Chrysler Automobiles NV and Unifor this week, after the union’s members ratified a three-year agreement with Ford Motor Co. of Canada that will see electric vehicles made in Oakville, Ont.

Ford said it will spend $1.8-billion retooling the factory west of Toronto in 2024 to make battery-powered vehicles, according to the agreement between the Detroit-based automaker and Unifor’s 6,300 members at Ford. Another $148-million will go toward building a new engine at Ford’s plant in Windsor, Ont., Unifor said.

Jerry Dias, Unifor national president, said the total includes spending from the federal and Ontario governments.

The Ford agreement, ratified by 81 per cent of votes cast, includes a 5-per-cent raise and productivity bonuses of $7,250. Under the old agreement, Ford’s production workers made $21 to $36 an hour, and skilled tradespeople were paid $42.

The number of jobs at the Oakville plant will fall to about 3,000 from 3,400, Mr. Dias said by phone, adding retirements would easily account for the job losses because of the average age of workers.

Unifor said the production plan includes a plug-in crossover sport-utility vehicle in Oakville and a new six-litre engine for Windsor.

Ford said it will become the first auto company to make battery-powered vehicles in Canada, but did not provide details on the lineup nor the taxpayer aid, which was reported to be about $500-million.

“We are still in discussion with both the federal and provincial governments to help build a stronger future for our employees, our customers and our communities,” Ford spokesperson Rose Pao said in an e-mail. “Governments around the world understand the economic benefits of winning an automotive investment.”

Ford begins selling the all-electric Mustang Mach-E, assembled in Mexico, later this year. An electric version of its F-150 pickup truck is scheduled to be sold in mid-2022. Electric vehicles available in Canada from other manufacturers include the Chevrolet Bolt EV, Nissan Leaf and Tesla Model 3.

“Working collaboratively with Unifor, and as discussions continue with both the federal and provincial governments, this agreement is an important step toward building a stronger future for our employees, our customers and our communities,” Dean Stoneley, head of Ford Canada, said in a statement. “By introducing battery electric vehicle production at Oakville assembly complex, we are cementing our Canadian operations as a leader in advanced automotive manufacturing.”

Production of the Oakville plant’s Ford Edge and Lincoln Nautilus is expected to end in 2023, Unifor and industry experts agree. Unifor went into the talks seeking to save the plant by securing new products for the assembly line that first made cars in 1953.

Mr. Dias said talks with Fiat Chrysler begin on Thursday, and the issues are similar to the ones on the table with Ford.

He said the automaker’s minivan plant in Windsor needs one or two new vehicles to restore the third shift of workers, which was cut in July and eliminated 1,500 jobs. Fiat Chrysler’s Brampton, Ont., plant, which makes Dodge Challenger and Charger muscle cars and the Chrysler 300 sedan, needs another vehicle to “stabilize” the plant, and the Etobicoke casting plant in west Toronto needs new products, Mr. Dias said. “There’s a lot of issues,” he said. “But that’s okay. We have a unique way of resolving our issues.”

Fiat Chrysler, which employs 9,000 Unifor members, did not answer questions about the allocation of vehicle production at its plants. “FCA Canada welcomes the opportunity to move our discussions with Unifor forward,” said LouAnn Gosselin, a spokesperson. “We are committed to reaching an agreement that will allow us to continue investing in our future and create opportunities for our employees, their families and the communities where we live and work.”

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