TORONTO (WWJ) – On the eve of the start of contract talks with the Detroit Three carmakers, the leader of the Canadian Auto Workers Union says there’s one issue above all others, jobs.

“Two of the three companies still have a significant amount of members on layoff,” CAW President Ken Lawenza told WWJ AutoBeat Reporter Jeff Gilbert. “So, needless to say jobs are going to be the key to these negotiations from the union perspective.”

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Talks will take place in Toronto, beginning with Chrysler and General Motors on Tuesday, and expanding to include Ford on Wednesday. The deadline is mid-September.

Last year’s contract with the UAW here in the U.S. included improved profit-sharing, instead of pay hikes. While the CAW doesn’t like this, Lawenza says his negotiating team will be flexible.

INTERVIEW: CAW President Ken Lawenza talks with WWJ AutoBeat Reporter Jeff Gilbert.

“Quite frankly, we think annual wage improvements are significantly better for workers than profit-sharing,” he said. “But, at the end of the day, how we deal with compensation and these renewed profitable times with the corporations will be discussed in these negotiations.”

It’s likely to take a creative deal, Lawenza says. His comments were similar to those made earlier this month by Jim Tetrault, who’s Ford’s vice president of North American Manufacturing.

“We’ve gotta do some of the same things that we did here in the U.S., don’t we,” he said. “Y’know it’s an expensive place to produce. Some how we have to all come together and figure out how we make that work. That’s what we’re focused on.”

Auto executives have been asked about these talks on several occasions. The common threat is a need to get costs under control.

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“Building a car in Canada is the most expensive place to build a car in the world right now,” said GM CEO Dan Akerson.

Speaking at the company’s annual meeting, Akerson said GM’s “very dedicated” Canadian employees make high quality products, with high productivity. But, they need to deal with the cost issue. And he feels they will.

“I think reasonable people should be able to come to common ground for the benefit of both.”

The bottom line, says Chrysler CEO Sergio Marchionne, his company can’t afford higher costs on the Canadian side of the border.

“The three Canadian plants that we run need to be benchmarked and they need to be looked at in terms of a totally connected manufacturing infrastructure between Canada and the United States,” he said at this year’s North American International Auto Show. “We can not tolerate and we will not tolerate a differential in cost positions between Canada and the United States that effectively favors one country vs. the other.”

CAW President Ken Lawenza says he anticipates that this will be an issue, but the union has to negotiate on its strengths, not its weaknesses. A strike, he says, is possible, but not necessarily likely.

“If they’re overzealous, and demanding significant sacrifices, then we will probably have a work stoppage. But, I can tell you and your audience that the CAW is going to do everything in their power to avert a strike, as long as common sense prevails.”

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