Union 'disappointed' by Ottawa's $500M auto sector pledge

The union representing 4,500 hourly workers at Chrysler's Windsor Assembly Plant isn't pleased with the 2014 Federal Budget delivered Tuesday.

The budget gave a $500-million boost to the Auto Innovation Fund. The money will be spread over two years.

Dino Chiodo, president of Unifor Local 444, says the money simply isn't enough.

"I am, quite frankly, disappointed. This is not helpful," Chiodo said."The reality is there isn't a country that isn't doing this. This is 4,500 jobs; 30,000 spin-off jobs."

In a news conference Wednesday morning, Finance Minister Flaherty called auto sector jobs a key to the Ontario economy and said he would be “very slow to let them go.”

“It’s not just the thousands of people that work in the plants, but also the many suppliers, restaurant owners and other businesses that rely on the auto industry,” Flaherty said, adding that he had long familiarity with the Ontario auto industry from his years as a provincial cabinet minister.

“I am adamant in support of the auto manufacturing as a hub for employment in Canada, in Ontario,” he added.

His remarks seem to buoy the chances of a federal-provincial package for Chrysler operations in Windsor and Brampton, after the automaker sought a contribution of up to $700 million to rebuild and retool.

The federal budget document acknowledges the importance of auto sector jobs, estimating more than 115,000 Canadians in Southern Ontario and across Canada are employed in automotive assembly and parts production. 

But that wasn't enough for one Windsor union leader.

"The reality is, direct investment is part of the global market. Companies will go where they get the biggest gain," Chiodo said. "They done it in Oakville, they should be doing it right here in Windsor."

Ottawa and Ontario combined to give Ford $150 million for upgrades at its Oakville plant.

"If they don't do this, Windsor will be a ghost town," Chiodo said. "We cannot afford another Heinz, where jobs pull out and there's no help."

Last year, Heinz announced it will close its Leamington plant and put nearly 800 people out of work.

"It takes billions of dollars in order to facilitate retrofitting some of those plants, so $500 million is not that much," Chiodo said.

Auto researcher Tony Faria doesn't think the government will have a choice but to funnel money to Chrysler.

"It's hard to imagine what things would be like in Essex County without that Chrysler assembly plant," said Faria. "I'm all in favour of the government helping Chrysler in this investment."

On the opposite side is Mark Milke with the Fraser Institute, a conservative think tank based in Calgary.

"Special interest corporate welfare is a bad idea because what it does is redistribute jobs — it doesn't create new jobs," Milke said, who added auto investment money would be better spent on social welfare programs and retraining.

Faria, though, pointed to a recent investment by the state of Tennessee in a Volkswagen plant, calling it a wise investment over time.

"Tennessee will get that money all paid back inside of  eight years in terms of the taxes being paid by that plant," he said.

Chiodo pointed to recent investment made directly into the Ford plant in Oakville. He said would have liked to have seen something similar in Tuesday's budget.

"From that perspective there's no reason why it shouldn't be done here in Windsor, Ontario, for that investment to make sure we can maintain our future," said Chiodo.