Business and Finance

Canadian governments must intervene to prevent the loss of whole auto assembly plants to the United States, says the president of the Canadian Auto Workers.

Despite $3.4 billion in conditional emergency aid promised to Canada’s ailing auto makers Friday by the Ontario and federal governments, Ken Lewenza says excess capacity at Canadian auto plants must be protected or General Motors, Ford and Chrysler could move plants and equipment south of the border.

"If the Canadian government doesn’t do anything … you’ve got to believe that over time, our products would be moved," Lewenza said yesterday in an interview. "We don’t want GM to pick up and say, it’s been nice doing business in Oshawa but sorry we’ve got a better deal in the United States. We want to ensure that when the Americans put their legislation together, it isn’t on the backs of Canadian jobs."

Lewenza also said that thousands of jobs could still be lost even with additional aid unless the money is contingent on manufacturers keeping workers in jobs and plants open.

Lewenza’s warning comes on the heels of Federal Industry Minister Tony Clement’s announcement late Friday of the conditional $3 easy payday loan.4 billion for Canadian operations of General Motors, Ford and Chrysler based on the $14 billion (U.S.) the White House is contemplating in rescue money for the Detroit Big Three.

The Bush administration spent yesterday weighing its options, but details were scarce as to how much interim financial aid the U.S. government would provide to stave off a collapse of the troubled industry. On Thursday, Republicans in the U.S. Senate refused to pass a $14 billion (U.S.) rescue bill, throwing the future of the Big Three into doubt. GM and Chrysler have already warned they could run out of cash in a matter of weeks without immediate government aid.

But Ontario’s assembly plants are already on the brink. Chrysler’s Windsor minivan plant will be shut down for the month of January, while GM’s car plant in Oshawa is scheduled for a six-week closure starting at the same time. Lewenza said Ford’s Oakville plant is also anticipating shutting down operations for two weeks early in the New Year. The three companies employ more than 30,000 people in Ontario.

Source