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American NAFTA auto proposals deliberately untenable: Unifor

October 13, 2017

Washington – Unifor, representing 41,000 Canadians in auto and auto parts manufacturing, says that the newly tabled U.S. proposals on rules of original are deliberately untenable.

“Frankly, I think this is a bully move by the American government,” said Unifor National President Jerry Dias. “The U.S. is making one-sided demands that they know we can’t accept as they would seriously damage Canada’s already weakened industry.”

Today, American negotiators put forth a demand requiring all vehicles covered under a renegotiated NAFTA to include 85 per cent North American content with a specific “Made in America” content requirement of 50 per cent.

“The U.S. believes they deserve an unfairly high level of U.S. content in vehicles from Canada or Mexico. This combined with no attempt to fix the underlying labour and tariff problems means they don’t care if our auto industries live or die,” said Dias.

Unifor has publicly supported a call for higher auto content thresholds in NAFTA, as well as a modernized list of qualifying parts, as part of a package of reforms designed to promote more fair and balanced trade, both within North America and with the rest of the world. However, higher content thresholds mean very little unless imbalances in labour standards and border tariffs are addressed as well.

“Right now the price of entry into the U.S. market for non-NAFTA passenger cars is a 2.5 per cent tariff, and in Canada it is 6.1 per cent. That’s far lower than many auto-producing jurisdictions and not a very strong incentive to encourage automakers to build here in North America,” Dias said. “It might prove cheaper for automakers to ignore NAFTA rules and simply pay the 2.5 per cent. That won’t help anyone.”

Unifor has proposed that NAFTA rules should encourage balance across all three countries; tariff-free access in NAFTA should be tied to a fair distribution of a company’s production and employment in the three countries.

Unifor is Canada’s largest union in the private sector, representing more than 315,000 workers in every major area of the economy. The union advocates for all working people and their rights, fights for equality and social justice in Canada and abroad, and strives to create progressive change for a better future.

For more information, please contact Unifor Communications Representative Kathleen O’Keefe at kathleen.okeefe@unifor.org or 416-896-3303 (cell).