View Full Version : Big 3: Billion here, billion there.

12-12-2008, 10:41 PM

Canada sets conditional auto aid plan

ASSOCIATED PRESS • December 12, 2008

TORONTO — Canada’s federal government and the province of Ontario agreed Friday to provide $3.5 billion Canadian dollars ($2.8 billion) for the Canadian auto industry.

Federal Industry Minister Tony Clement said the main auto manufacture restructuring will be done in the United States, but Canada is also prepared to provide help to save the troubled industry, which employs hundreds of thousands of direct and spinoff jobs in Ontario.

“What we are signaling here tonight, both the governments of Ontario and Canada, is that we want to be part of the solution as well and it will be commensurate with the production that takes place here in Canada ... about 20 percent,” Clement told reporters.

The Detroit Big Three automakers currently employ more than 30,000 people at car assembly plants in Ontario.

The move by Canadian politicians comes after the U.S. Senate rejected a US$14 billion plan, endorsed by U.S. President George W. Bush and congressional Democrats, that would have provided quick loans to the Detroit automakers.

On Friday, GM, Ford and Chrysler were talking with the administration and the U.S. Federal Reserve about how they could still get the billions of dollars they say they need to survive. The talks included conditions that automakers would have to meet, said GM spokesman Greg Martin.

Canada’s federal government came under increasing pressure to announce a multibillion-dollar aid package for the auto industry even before the White House finalizes details of its planned bailout of the battered Detroit Big Three.

The president of the Canadian Auto Workers union said Friday that aid can’t come quickly enough for General Motors, Ford and Chrysler and their Canadian subsidiaries.

“The Canadian government should be proactive, announcing a Canadian financing package conditional on a U.S. package coming together,” CAW president Ken Lewenza told a news conference.

Both the federal and Ontario governments have been reluctant to hand out any aid without first seeing the details of a comparable U.S. package so they can match any conditions and provide a proportional amount of funding.