“Stronach has a high opinion of himself, but there’s no reason to think he isn’t a seriously smart guy,”’ said Dan Luria, an analyst at the Michigan Manufacturing Technology Center in Plymouth, Michigan, who called the timing of the talks more than coincidence. “Besides wanting Chrysler, he wants to be able to say he remade labor relations in North America.”

Stronach, who built Magna into Canada’s largest auto-parts maker, said in its annual report on March 28 that the current labor-relations system is the North American auto industry’s biggest handicap. He called for a new “framework of fairness” that would include profit sharing instead of rigid wage formulas.

UAW spokesman Roger Kerson and Magna spokeswoman Tracy Fuerst declined to comment.

The CAW, based in Toronto, now represents 1,000 workers at three Magna factories in Canada, where the company has 18,000 employees at 45 plants. In the U.S., the Detroit-based UAW has organized eight Magna factories with 4,000 hourly and salaried workers. Magna has 18,000 employees at 54 plants in the U.S.

Chrysler Bid
Workers at each Magna factory would have to vote to accept the expanded relationship, Hargrove said. The 63-year-old union leader said he didn’t know when the talks would be finished, in part because Stronach and other Magna executives have been preoccupied since February with the Chrysler bid.

Jerry Dias, a representative of the Canadian union, said last week after a meeting with DaimlerChrysler’s labor committee that the CAW, the UAW and the IG Metall union in Germany prefer that the company keep Chrysler. “If they choose to spin it off, we can live with Magna,” Dias said.

Other Bidders
Other Chrysler bidders include buyout firms Cerberus Capital Management LP and a Blackstone Group LP-Centerbridge Capital Partners LLC partnership, people familiar with the offers have said. Billionaire investor Kirk Kerkorian’s Tracinda Corp. announced its $4.5 billion offer for Chrysler on April 5.

Dieter Zetsche, chief executive officer of Stuttgart, Germany-based DaimlerChrysler, said on Feb. 14 that “all options are open” for Chrysler. The U.S. unit, based in Auburn Hills, Michigan, posted a $680 million loss for last year as high gasoline prices damped demand for the pickup trucks, sport- utility vehicles and minivans that account for about three- fourths of its sales.

If all of Magna’s workers vote to join the CAW, the percentage of Canadian auto-parts workers belonging to unions would rise to 75 percent, a level not seen since the 1970s, from 45 percent now, said Hemi Mitic, an aide to Hargrove.

The UAW represents less than 30 percent of U.S. auto-parts workers, Luria said.

‘Fairness Committee’
The CAW’s current contracts at three Magna factories include a traditional grievance procedure, Mitic said. They also allow for some of Stronach’s innovations, including an anonymous hot line and a ``fairness committee’’ of workers chosen by management to review complaints.

CAW members at a Magna seat plant in Windsor, Ontario, are paid about C$27 ($24.30) an hour including profit sharing, Mitic said. Magna’s policy is to have a pay scale close to industry averages for specific parts, with workers making sophisticated components such as seats receiving the highest pay, he said.

The CAW’s role is to act as a “check and balance” to make sure managers in Magna’s decentralized units don’t let wages slip below industry averages, Mitic said. The need for that role has grown along with Magna’s size, he said.
Magna, which Stronach started in a rented Toronto garage in 1957, earned $528 million on $24.2 billion in sales last year. The company’s sales have more than doubled since 2001.

Magna shares were unchanged at C$87.85 at 4:15 p.m. in Toronto Stock Exchange trading. They have declined 6.4 percent this year.

In 1999, the CAW threatened to strike at DaimlerChrysler unless the automaker pressured Magna to be less hostile to union organizers. After that threat, DaimlerChrysler asked Magna to let workers decide on joining the union without fear of intimidation.

To contact the reporter on this story: John Lippert in Southfield, Michigan, at .