Word has it in Canada that EMD’s loco plant in London might close if Caterpillar/Progress and the union don’t reach a deal since it’s reported that Caterpillar wants steep cuts to wages and benefits. I guess if Caterpillar shuts down EMD in Ontario, the new, recently acquired plant in Muncie, IN would be EMD’s primary source for loco production.
http://www.lfpress.com/news/london/2011/12/19/19144316.html
ELECTRO-MOTIVE: Conservative MPs reluctant to intervene in contract talks between company and CAW
By CHIP MARTIN, The London Free Press
Concerned London may lose one of its largest industrial employers, Mayor Joe Fontana enlisted four London MPs to help him write a letter to its parent firm explaining the importance of the plant to the city.
The Electro-Motive Diesel Inc. plant on Oxford St., owned by Caterpillar Inc., employs 700.
Canadian Auto Workers officials worry the plant may be shuttered if the locomotive manufacturer can't reach a contract deal with the union in ongoing talks. The union says the company wants to slash wages and benefits, a move it opposes.
Fontana said the No. 1 priority in the city these days is jobs.
The Electro-Motive jobs, and another 1,300 dependent on them, "are jobs this city cannot afford to lose," he said.
Typical negotiation tactic.
I am not saying that Cat doesn't necessarily mean what they are saying - but these kinds of threats are routinely thrown into labor agreement negotiations. Only time will tell.
Never too old to have a happy childhood!
There's really no great advantage to having a plant in Canada, and I'm sorry to say that as I'm a Canadian and this would be ANOTHER closure in addition to the many we've had over the last 10 years.
But looking at it from CAT's standpoint, the border is problematic for reasons we all understand...we have different currencies...we have different regulations... and only one of our two main railroads even buys from EMD these days. So if I were a CAT exec I would also be questioning the logic of a plant in Canada when a new plant in the US would score big points politically as well.
Progress Rail's original locomotive plant/ shop is also in the US, at Albertville, Alabama - see:
http://www.progressrail.com/products-locomotive.asp
And I thought they also had a loco shop in Georgia someplace ?
Progress Rail {EMD}, up and running new facilities here in Muncie, In...It is the former ABB heavy power transformer plant. Facilities appropriate for heavy product production. Well suited for railroad engine production.....Massive size plant....rails already right into the plant....90' plus high ceiling and very heavy concrete floors, etc....Very heavy duty overhead cranes in place....Plant surrounded by plenty of land.
Engines are already being produced. Progress Rail took over the plant roughly a year ago.
Quentin
When EMD ceased locomotive production at LaGrange in 1992 the exchange rate was 77 to 87 cents on the dollar, Loony vs. Greenback. Today they are practically at parity. Even with nationalized healthcare it is getting tough to justify leaving production in London. Canada has become a victim of its own success.
Editor Emeritus, This Week at Amtrak
What is the union status of the Muncie plant? If it is unionized, is it the same one as the London plant?
A few observations: The story in the London Free Press mentioned that the local head of the Canadian Auto Workers fears that Cat wants to move production to the United States, where labor costs are lower (!). Also, Cat management has a very long record of playing hardball when it comes to labor negotiations and has taken several long strikes in the past to make its point. The Canadians may not be ready for this kind of negotiating style.
Yes, Cat does play hardball with the unions. At their plant in York, Pa, near me he workers went on strike. Finally CAT gave them an offer which they accepted. As soon as the strike was over they closed the plant nd moved the production to Muncie, Idiana. All of the workers lost their jobs. They do NOT fool around with unions and the Canadian unons should take note of lthis if they want to keep working at the London, On plant.
Muncie plant unionized....? That I don't know the answer to. Just from the articles we've seen {locally}, I gather the wages are to be quite decent.
From all the data so far, I can't say if the workers are unionized. If I had to take a guess....I'd say it isn't currently...{only my guess}.
That question (union) may become moot. Indiana's legislature will, again in 2012, consider a "right-to-work" law whereby, you don't have to join the union to get the job. Last year a majority of Democrats fled the state to avoid the issue by denying a quorum needed to conduct the business of the state because they knew they didn't have enough votes to stop it. I can only assume CAT would be in favor of this law.
rrnut282 That question (union) may become moot. Indiana's legislature will, again in 2012, consider a "right-to-work" law whereby, you don't have to join the union to get the job. Last year a majority of Democrats fled the state to avoid the issue by denying a quorum needed to conduct the business of the state because they knew they didn't have enough votes to stop it. I can only assume CAT would be in favor of this law.
"Right to Work" doesn't mean you can't have a union. It just means union membership isn't required for employment. Iowa is one of those states, but many factories and meat processors (etc) have unions that represent the work force, even though not all employees eligible belong.
Jeff
The Muncie plant is not Union. And lets be clear here, the Muncie plant is a Progress rail plant doing contract work for EMD. The London Plant is an EMD plant. EMD is a Union Shop, Progress Rail is not. That's how the Muncie facility gets away without being Union.
Given EMD's current orders which are filling the lines at both plants, I can't imagine that there is a corporate interest in getting rid of London. At least not right now.
Also, CP just put in a huge huge huge order for ECO locos with EMD, so they are getting contracts with both Canadian roads.
YoHo1975 The Muncie plant is not Union. And lets be clear here, the Muncie plant is a Progress rail plant doing contract work for EMD. The London Plant is an EMD plant. EMD is a Union Shop, Progress Rail is not. That's how the Muncie facility gets away without being Union. Given EMD's current orders which are filling the lines at both plants, I can't imagine that there is a corporate interest in getting rid of London. At least not right now. Also, CP just put in a huge huge huge order for ECO locos with EMD, so they are getting contracts with both Canadian roads.
Run this by me one more time....
Progress Rail bought EMD but EMD is now contracting out work to its owner? Wasn't the London, ON facility included in the purchase of EMD by Progress Rail? (Progress Rail being owned by Caterpillar.)
EMD is a wholly owned subsidiary of Progress rail. They are a separate company which must abide by all of the agreements it made prior to purchase. Similarly, Caterpillar owns Progress rail which is a wholly owned subsidiary of Cat. Progress Rail does not need to abide by any of the commitments Caterpillar has made to it's unions.
Progress rail owns EMD which owns the London plant. Progress also owns the Muncie plant, but EMD does not. Therefore the EMD work at the Muncie plant is contract work performed by Progress on behalf of it's subsidiary. It's a sneaky way to get around a forced unionization.
It's also Standard Business Accounting.
Other Progress facilities have performed contract work for EMD as well.
All of the latest post seems correct to me as far as ownership is concerned....And...for many folks here in Muncie, we're pretty happy the facility is here, and business seems to be headed upward.
We've lost major auto parts mfg. plants in the past several decades, and this business is certainly welcome.
Most contemporary union contracts prohibit subcontracting or outsourcing "union work" ("bargaining unit work") to a non-union shop, provided that the union has the bargaining clout and sophistication to get that negotiated into the final signed contract. That should be equally effective for a subcontract upwards to the union shop's owner as much as for an outside 3rd party shop, unless that was a specifically negotiated exception.
On the other hand, if an independent 3rd party vendor supplies a partially-assembled component - even of fairly large size and scope - that may be viewed as just a large-item purchase, and not a subcontract. That may be equally true when the vendor is the parent company as well . . .
The result may turn on exactly what work is being done by whom, and the extent to which it is being done by a union workforce, as well as the present economic conditions and alternatives. If the parent company is now performing the same task that a non-union vendor has traditionally and previously done, and hence there's little or no capacity to bring it in-house, there's no point to 'grieving' (union complaining and perhaps striking) about it.
- Paul North.
Correct on ll ccounts. BUT if Catapillar through its Progress Rail subsidiary closes the EMD shop in London, Onterio and moves the work to Muncie, there is nothing that the union can do about it. As I stated earlier, that is what they did in York, Pa.
In labor relations, plant closure is viewed as the equivalent of 'industrial suicide'. The rationale is that's such a drastic move and essentially ends the company's operations there, so that it must be for serious, irreversible, and unchangeable business/ financial reasons, and not merely a bargaining tactic. Said another way, the actions speak louder than the words. The NLRB and courts usually take a 'hands-off' position on that action as a management prerogative, and do not view that as an unfair labor practice - unless the union has negotiated a non-closure provision, that is.
Paul,
What you say is true, but Canada is a Foreign Country especially as to labor laws.
Mac
The people of Indiana especially Govenor Mitch Daniels would welcome the new business in Muncie.All of Caterpillar big engines are made across the state in Lafayette.Cat means business when it come to trains.THey just invested close to 9 billion to get Bucyrus's mining equipment business to give their customers product they have been asking for.
Remember the NLRB stopping Boeing at their South Carolina plant from building the 787 jet.
ccltrains Remember the NLRB stopping Boeing at their South Carolina plant from building the 787 jet.
No they didn't:
http://www.thesunnews.com/2011/12/23/2565642/air-india-to-get-first-sc-787.html
Didn't Fox News report that?
Dave
Lackawanna Route of the Phoebe Snow
Actually at First teh NLRB was Stopping Boeing from Opening the Opening of the Second 787 Plant. However it was when the IAM agreed to the NEW contrtact that contained Language that states the NEW 737 Line will be in a IAM Represented Plant they Agreed to DROP THE CASE. So how is the NLRB NOT BEING BIASED IN THE CASE when they only dropped the case AFTER BOEING was FORCED to neogotiate from a postion of Weakness to agree to let the IAM dictate where the Best Selling Plane of ALL TIMES be Assembled.
Without a complainant they have nothing to conduct a hearing about. When the IAM was bought off the NLRB could not act.
That is exactly the way it is supposed to work. The union made a complaint. The NLRB began an investigation to see if the complaint had Merritt. Boeing and the union came to terms and the complaint was withdrawn. The investigation was, therefor, moot.
That is NOT the same as "the NLRB stopping Boeing from building the aircraft" there. You do not know what the outcome of the investigation would have been.
It's really disappointing that union-busting has become an acceptable management tactic, often with the encouragement of state and local governments.
There have been too many companies that have gone bust because of the greedy unions. They were good in their day, but now with all of the labor laws they ar superfluous. They should be made to act like they do with the federal government. You CANNOT STRIKE. You CAN and should look after your members interests, BUT when a company says this is our offer your take it or the old labor contract stays in effect for the lenth of its term (say a 3 yer contract), then you can negoritate again. Compnies have the absolute right to close plants if they wish, that is a management decision.
gsrrman There have been too many companies that have gone bust because of the greedy unions. They were good in their day, but now with all of the labor laws they ar superfluous. They should be made to act like they do with the federal government. You CANNOT STRIKE. You CAN and should look after your members interests, BUT when a company says this is our offer your take it or the old labor contract stays in effect for the lenth of its term (say a 3 yer contract), then you can negoritate again. Compnies have the absolute right to close plants if they wish, that is a management decision.
In a race to the bottom, who wins?
It's been fun. But it isn't much fun anymore. Signing off for now.
The opinions expressed here represent my own and not those of my employer, any other railroad, company, or person.t fun any
In this case I'd say CAT does. Striking is a legitimate bargaining tool although of limited value when the employer can simply respond by shutting the plant down or moving it . CAT is a large multinational that has the wherewithal and the bucks to relocate plants as it sees fit. The employees in London don't have that many options in terms of good paying manufacturing jobs, and I'm sure CAT knows that and bargains accordingly.
Our community is FREE to join. To participate you must either login or register for an account.