Productivity at Airbus plant in Canada slips as workers mull new contract offer

By Allison Lampert

MONTREAL (Reuters) - Productivity has slipped at a Montreal-area Airbus factory trying to ramp up assembly of the planemaker's smallest commercial jet, as workers consider a new contract offer, according to sources and a union memo sent on Friday.

Airbus and union negotiators failed to reach a negotiated deal this week following intensive talks, but a second company offer will be considered by the estimated 1,300 workers on April 7, according to the memo seen by Reuters.

Details of the new offer, made after workers overwhelmingly rejected an earlier one this month, were not available.

Assembly workers at the plant, which makes A220 jets, were recently told by the company that overtime work was cut and productivity was down due to the talks and supply chain snags, three sources who spoke on condition of anonymity told Reuters.

The European planemaker is trying to grow production of the money-losing A220 jets, which have roughly 110 to 130 seats, to a combined 14 planes a month in 2026, spread between the factory in Mirabel, Quebec, and a plant in Mobile, Alabama. That would be up from six a month in December 2022, the latest publicized rate.

"Despite a certain slowdown in productivity felt recently, we are maintaining our overall ramp-up target of 14 aircraft a month in 2026," a spokesperson for Airbus's Canadian division said in a statement. "We have taken measures to recover efficiency."

The International Association of Machinists and Aerospace Workers union (IAM), which wants higher wages and better conditions for the workers at the Airbus facility in Mirabel, said earlier this month it would start pressure tactics that would slow production after workers gave strike authorization.

Unions have recently capitalized on tight labor markets and high inflation to win hefty contracts at the bargaining table, with airline pilots, autoworkers and others scoring big raises in 2023.

The Airbus talks in Canada are being watched by IAM leaders in Washington state, where Boeing's production workers want wage increases exceeding 40% over three to four years, a spokesperson for the union's U.S. local there said.

In Montreal, the local representing the Airbus workers said negotiations are continuing, without offering further details.

Workers have held noisy disturbances at the factory in Mirabel.

"Recently, some employees have put forth their point of view and we heard them," Airbus said. "We remain committed to reconciling the interests of our employees with the economic imperatives of the A220."

(Reporting by Allison Lampert in Montreal; Editing by Paul Simao)