After keeping unions out fro some 50 years in both the United States and Canada, Magna International is reportedly set to invite organizers to the party.
The announcement of talks between Chairman Frank Stronach and leaders from the UAW and CAW, was alluded to after the companies annual meeting in Toronto on May 2nd.
Carrying some 120 U.S. plants, Magna could emerge from 2006 as North America’s top auto parts supplier, after the dust settles on struggling manufactures like Delphi.
Magna has long been a company based on profit sharing as opposed to unionization. In fact, only 11 plants, or roughly 5 percent of Magna’s 82,000 workers are unionized.
Christopher Ceraso, an analyst with Credit Suisse sees Magna in a uniquely strong position to profit from the looming trouble in the industry. According to Ceraso, Magna could be positioning itself to begin accumulating assets and new contracts, as more and more suppliers shed customers and capital as part of their various chapter 11 efforts.
“Magna will emerge as one of a handful of large and powerful Tier 1 suppliers that survive the impending Armageddon,” Ceraso wrote in a report.
The Aurora Ontario company ranked 11th on the Automotive News list of the 150 largest suppliers of original equipment parts to North America with sales of $2.58 billion in 1995. It now ranks No. 2 with 2005 sales of $12.77 billion. Wall Street analysts expect that number to continue climbing in the coming years.
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