(Video: CTV • Story: The Canadian Press/Globe & Mail)
In an effort to avoid a “catastrophic” collapse of the auto industry, the federal and Ontario governments have announced a $4-billion bailout package for the Canadian subsidiaries of the Big Three automakers.
The announcement by Prime Minister Stephen Harper and Premier Dalton McGuinty in Toronto came a day after U.S. President George W. Bush offered $17.4-billion U.S. in emergency loans to General Motors and Chrysler.
The Canadian plan will provide General Motors Canada with loans of up to $3 billion and Chrysler Canada will receive up to $1 billion. The companies will get the money in three instalments, with the first portion coming Dec. 29.
“We are doing this on the assumption that we cannot afford either in the U.S. or in Canada a catastrophic short-term collapse,” said Mr. Harper.
Mr. McGuinty, whose government will provide $1.3 billion of the total emergency loans package to General Motors and Chrysler, put a human face on the crisis that has hit the auto industry.
“Here in Ontario we have 400,000 people and their families who rely on the auto industry so that they can put food on the table and keep a roof over their heads,” said the Ontario premier who thanked Mr. Harper for the support.
“What the prime minister and I are saying today is that those people and their jobs are worth fighting for.”
Mr. Harper, however, warned that today's announcement “is not a blank cheque” for the industry, suggesting both the companies and their employees will have to make concessions. Read more here.