Automakers appeal to Ottawa as layoffs mount

Fri Dec 5, 2008 5:07pm EST
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By John McCrank

TORONTO (Reuters) - The Big Three North American auto companies took their case for emergency aid to the Canadian government on Friday against a backdrop of fresh layoffs at the country's assembly plants.

General Motors Corp, Ford Motor Co and Chrysler LLC are seeking billions of dollars from Ottawa to help them survive a severe, industry-wide downturn.

Executives were also in Washington on Friday asking for $34 billion in U.S. government loans and credit lines for the industry, which has been badly battered by the U.S. economic downturn.

No dollar figure has been attached to any Canadian aid package, but Reid Bigland, president and chief executive of Chrysler Canada said his company is seeking a proportionate amount to the $7 billion it is asking for in the United States.

About 20 percent of Chrysler's sales come from Canada, where it manufactures 20 to 25 percent of its vehicles.

Bigland said Canada would see upward of 500,000 direct and indirect job losses if the Detroit Three were to fail. He said that was a real possibility if the companies cannot secure the U.S. funding.

Canadian Industry Minister Tony Clement said on Thursday that no decision had been made yet on whether to support the industry, an economic linchpin of the industrial heartland in Ontario and Quebec.

Clement made the comment at the opening of a new Toyota Canada plant in Woodstock, Ontario, built with financial support from both the federal and provincial governments.   Continued...

<p>Ford Motor Company of Canada head office, pictured, is situated beside it's Oakville Assembly Plant in Oakville, a Toronto suburb, February 15, 2006. REUTERS/J.P. Moczulski</p>