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The End of an Era: EMD From General Motors to Caterpillar

February 18, 2012

A brief timeline:

  • 1949: General Motors (GM) opens a branch of their Electro-Motive Division (EMD) in London, Ontario, Canada and introduces a the ‘road switcher’ or hooded locomotive. Their primary competition being General Electric (GE).
  • 1991: Due to NAFTA (North American Free Trade Agreement) – GMD consolidates locomotive production (from La Grange facility) at the London plant.
  • 2005: General Motors divests itself of all non-core (non-automotive) assets: GMD is sold to the Greenbriar Equity Group LLC and Berkshire Partners LLC and becomes Electro-Motive Diesel, Inc.  (EMD).
  • 2010: Caterpillar, Inc. purchases EMD from Greenbriar and it becomes a wholly-owned subsidiary of Progress Rail Services Corporation.
  • 2010: October – Caterpillar announces the development of a plant in Muncie, Indiana, USA in order to produce locomotives for publicly funded rail systems which, due to legislation, are required to be assembled in the US.
  • 2011: In late December, Caterpillar tables a contract offer to the CAW (Canadian Auto-Workers Union) that appears to cut salaries by up to 55% and includes cuts to benefits as well as affecting pensions. The union rejects the offer and prepares for negotiations or a possible strike action.
  • 2012: January 1st – Caterpillar locks out their unionized workforce and a picket line appears outside the fenced in facility.  No negotiations are in progress.
  • 2012: January’s 9th – Caterpillar lays off approximately 20 salaried personnel.
  • 2012: January 21st – The CAW garners support locally and from various unions across the country and within the US, holding the ‘London Day of Action’ on the 21st of January. There is no response from Caterpillar, privately or publicly. The action is attended by various levels of government with London Mayor, Joe Fontana, uttering the following: “Get your ass down here, Mr. Prime Minister, Harper!
  • 2012: January 25th – The last locomotive to have left EMD prior to the lock-out is blocked from moving in nearby Ingersoll, ON.
  • 2012: January 25th – Local TSC stores show their support by removing Caterpillar products from their shelves.
  • 2012: January 26th – Caterpillar announces ~$1.5B in 4th quarter profits for 2011.
  • 2012: January 26th – Local sporting goods retailer, Source for Sports posts a sign reading “Caterpillar: Givin insects a bad name since 1925.”
  • 2012: EMD Muncie announces a job fair scheduled for February 4th.  Many of the jobs are at wages far below the current EMD London wages and below the offered contract wages.
  • 2012: February 1st – Indiana approves ‘Right to Work’ legislation.
  • 2012: February 1st – Blocked locomotive allowed to proceed by CAW. An injunction regarding blockades/picket lines a concern.
  • 2012: February 3rd – Caterpillar announces the closure of the London facility.  Coincidentally, Caterpillar’s Muncie job fair is the following day and ‘Right to Work’ legislation has just been signed in Indiana.
  • 2012: February 3rd – CAW states it will fight for their workers’ severance, threatening to occupy the plant (which still houses several unfinished locomotives) should Caterpillar not come to the table. It is expected that a negotiated settlement could include completion of the in-process locomotives.
  • 2012: February 5th – Local Mark’s Work Wearhouse retailers remove Caterpillar products from their stores.
  • 2012: February 7th – Severance negotiations begin with the hope that they will end quickly and fairly. Caterpillar expected to respond on ‘demands’ on the 9th.
  • 2012: February 9th – Negotiations to continue over the weekend. Grievances to be dealt with.
  • 2012: February 16th – Negotiations continue with a vote tentatively scheduled for Tuesday February 21st.
  • 2012: February 23rd – CAW ratifies a severance package that sees workers receive more than the minimum requirement at 3 weeks of pay for each year of work and a $1500 severance ‘bonus’ plus $350k towards re-training support.

*Update – 23 July 2012*

  • 2012: July 20th – the actual ‘For Sale’ sign goes up in front of the Oxford Street EMD Plant.  Operations are scheduled to cease in September of 2012.  Asking price is

 

After over 60 years of producing diesel locomotives at the London, Ontario facility – Electro-Motive Diesel, Inc. will cease production in 2012.  A victim of globalization, corporate greed, worldwide financial desperation and to some extent union agendas. There are, of course, other factors: the Indiana ‘right to work’ legislation that effectually eliminates unions; the various US policies that require certain items to be manufactured in the US, and the Canadian government’s inability to foresee the withdrawal of US corporations after buyouts.

Most of this means nothing to the people that lost their jobs – what they know is that they were treated unfairly by the corporation and are now without their livelihoods.  Point fingers in any direction, there is blame to be held everywhere. The time for blame is over, what needs to happen now is a plan to develop jobs for these and others that have lost their jobs as manufacturing positions have been eliminated in London and area for the past several years.

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