Ford and Canadian union Unifor have reached a tentative three-year labour agreement covering more than 5,000 workers, struck against a backdrop of 25% US tariffs on imported vehicles and parts, a simmering US-Israel war with Iran, and a stalled USMCA renewal. The deal, reached on 12 July and described by Unifor President Lana Payne as “the most consequential” in a generation, still requires ratification at meetings scheduled for 17-19 July.

The agreement covers members of six Unifor locals spanning Ford’s Oakville Assembly Complex, Windsor Annex and Essex Engine plants, and parts distribution centres in Ontario and Alberta. In a statement to Detroit Free Press, Ford Canada’s Vice President of Human Resources, Meredith Keenan, confirmed the tentative deal but declined to discuss specific terms, saying the company would “respect the ratification process.”

Unifor chose to negotiate with Ford first under a strategy known as pattern bargaining, in which the terms it secures go on to become the template for subsequent talks with General Motors and Stellantis, whose Canadian contracts are also set to expire on 20 September. According to Unifor, it started with Ford specifically because the automaker has shown the strongest commitment to maintaining operations in Canada—despite heavy trade pressure from the US—a signal about where it expects the hardest fights with GM and Stellantis to occur.

At the same time, the union—Canada’s largest—chose to enter the talks with managed expectations. It explicitly told its members not to expect anything similar to the record wage gains they had scored in 2023, in large part due to the deteriorating economic backdrop against which the talks were taking place. Beyond the unresolved trade disputes unfolding with the US, Iran war-induced fuel price shocks and a broader cost-of-living crisis have also affected North American demand for new cars, particularly those with internal combustion engines (ICE).

Ford’s F-150 is among its most popular, and production is reliant on Canadian plants

At the time of writing, around 6,000 autoworkers have been laid off across Ford, GM and Stellantis plants in Canada through 2026 as the companies shift or pause production. Unifor’s Payne has said tariff costs are increasingly displacing investment that would otherwise go toward Canadian plants, products and jobs.

That trade-off arguably explains the union’s willingness to settle without a strike: reaching a deal that prioritises job security and pension protection over an aggressive wage push reflects both sides choosing stability over an extended confrontation. Little surprise, given that neither party can be sure what the next set of abrupt US trade measures might do to Canadian production volumes, even if it is easy to presume some kind of future volatility. Still, Unifor has emphasised that it will not make concessions in the new contract; it simply won’t be asking for as much as last time.

For Ford, avoiding a strike secures three years of predictable—albeit marginally higher—labour costs at its Canadian facilities, including the Essex plant that supplies engine for its popular, high-margin F-Series pick-ups. This will grant the automaker a degree of certainty while it reverses some electrification investments and doubles down on ICE and hybrids. 

The tentative agreement received unanimous endorsement from the Unifor Ford Master Bargaining Committee, a sign of internal consensus that should support ratification. Should members approve the deal next week, Unifor will move directly into talks with General Motors and Stellantis, using the Ford terms as its opening reference point. 

Given how explicitly the union has tied this round of bargaining to tariff exposure and broader trade uncertainty, whatever job security and investment language to which Ford has agreed will become the table stakes that both remaining automakers are expected to match.