UPDATE 2: Ford Canada labor talks aim to cut $16/hr gap

http://www.reuters.com/article/rbssConsumerGoodsAndRetailNews/idUSN0231958020091002

Fri Oct 2, 2009 5:39pm EDT

* Ford labor costs $16/hr higher in Canada than in U.S.

* CAW wants Ford to guarantee its Canada production levels (Adds union comments, confirmation of $16 wage gap, Ford comments. In U.S. dollars unless noted)

By John McCrank

TORONTO, Oct 2 (Reuters) - Labor costs at Ford Motor Co (F.N) are about $16 an hour higher in Canada than in the United States, the Canadian Auto Workers confirmed on Friday, but union said it needs guarantees on production levels before it agrees to concessions to level the field.

The CAW and Ford have been in cost-cutting negotiations since Sept. 8.

The talks follow deals the union made with General Motors Co and Chrysler in the spring to help those companies qualify for billions of dollars in government aid needed to survive the industry downturn.

Those three-year collective agreements cut around C$19 ($17.60) an hour from labor costs at GM and Chrysler.

The United Auto Workers struck a deal with Ford in March that the company said brought its U.S. labor costs down to around $55 an hour. That leaves CAW labor costs, which include wages, benefits, vacation time, and a bevy of other items, about $16 higher.

"Based on the UAW already making economic sacrifices, that's in the ballpark," Ken Lewenza, the CAW's president, told Reuters. "You can argue a buck or two either way, but that's in the ballpark."

FULL story at link.

system how could their labor costs be $16 more per hour than ours? I was under the understanding that one of the reasons we couldn't compete was that our employers had to pay for health care. Didn't they claim there was several thousand dollars added to each car made in the US just for health care costs? Something doesn't add up here.

I must admit, I have no clue how the canadian tax/healthcare system works. I know I figure that normal working americans will actually "get" about 75%-85% of their actual salary or wage because of taxes and other things.

But you're right. In terms of how the article written ("Laber Cost" is not nearly ambiguous as "wage") it does not seem to make sense with all the reports that american made cars are more expensive due to our healthcare system.