On January 1st, 2012 Caterpillar, Inc locked out 465 workers at Electro-Motive, its London, Ontario locomotive plant, after offering a contract that would cut workers’ wages & benefits by more than half (to approximiately $16.50/hr).

Picket lines have been set up (photo), a long lockout is expected, and there are indications that Caterpillar is simply using this situation to both break the union (Canadian Auto Workers Local 27) and move the plant to Indiana (home of the pending ‘Right to work’ legislation). On Saturday January 21st, 7,000 – 10,000 people rallied in London is support of the Caterpillar workers (photos).

Here are a few talking points of background on Caterpillar, as well as some info on the Canadian Government’s role. I aimed to make this into a brief snapshot of the company, so I’ve added many links throughout for further information.

#1. Money is Available

Caterpillar’s wage cut demands of 50% are not a matter of need, as the following figures illustrate:

• Profits (3rd quarter,2011): $1.141 billion [up 44% from the 3rd quarter of 2010]
• Sales (3rd quarter 2011): $15.716 billion [record year]
• Current CEO’s pay: Doug Oberhelman received a $10.4 million compensation package of salary bonuses, stocks and options as the new CEO in 2010.
• Former CEO’s pay: Former chief executive Jim Evans’ 5-year compensation totalled $43.2 million (he left in 2010). In 2010, Caterpillar’s  top 8 executives were paid $67.6 million.

- A Chart of Caterpillar’s Quarterly earnings and sales, 2009-2011

#2. Harper gave $5 million in tax breaks to Electro-motive

On March 19th, 2008, Prime Minister Harper went to the Electro-motive plant to announce a $5-million federal tax break for the company (as part of $1billion in tax breaks for industry in general). Less than 3 years later, they are are looking to cut wages in half and threatening to leave Canada. Harper is now conspicuously silent on the issue.