Chrysler not close to deal on multibillion-dollar Ontario investment

Thu Feb 13, 2014 12:29pm EST
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By Solarina Ho

TORONTO Feb 13 (Reuters) - Chrysler Group LLC is nowhere close to a deal with the Canadian government on a multibillion-dollar investment to upgrade two Ontario facilities, including its minivan assembly plant in Windsor, its top executive said on Thursday.

Sergio Marchionne, the chief executive officer of Fiat Chrysler Automobiles Group, had previously said the decision hinged on economic incentives from Canada and the province of Ontario. He confirmed on Thursday that discussions were under way at both levels.

"We're not even close to a resolution of a proposal that is acceptable to us," Marchionne told reporters at the opening of the Canadian International Auto Show in Toronto.

Marchionne would not confirm the investment amount being discussed, but said it would cost at least $2 billion to retool the plants in Windsor and Brampton.

The federal government indicated on Wednesday that it might offer cash to keep Chrysler from pulling the plug on plans for an upgrade at the Windsor plant and from moving that assembly operation elsewhere.

Marchionne said on Thursday that a number of other countries, such as the United States and Mexico, had already approached the automaker.

The comments followed the Canadian government's budget announcement earlier this week. It included a promise to infuse the Automotive Innovation Fund with an additional C$500 million ($455.15 million) over the next two years to subsidize the country's auto sector.

Finance Minister Jim Flaherty said earlier that not all of the new money is meant to meet Chrysler's "substantial" demands.   Continued...