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Chrysler threatens to pull out of Canada

 
5 1,505 views Mar 12, 2009

The Canadian government wants GM and Chrysler to make further labor and legacy cost cuts

The Canadian government wants GM and Chrysler to make further labor and legacy cost cuts

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General Motors and Chrysler have told authorities in Canada they need as much as $8 billion in aid to stay afloat, more than double the original amount requested just three months ago, and in the latest twist Chrysler has threatened to pull out its operations if it does not receive the funds.

The Auburn Hills-based carmaker warned that it may have to close its Canadian plants unless it got sufficient labor concessions, as well as government aid and resolution of a tax dispute. The biggest issue are the labor costs, which are substantially higher than that of Toyota and Honda. As for actual government aid, Chrysler is seeking $2.3 billion, Reuters reports.

"Failure to satisfactorily resolve these three factors will place our Canadian manufacturing operations at a significant disadvantage relative to our manufacturing operations in North America and may very well impair our ability to continue to produce in Canada," Chrysler co-president Tom LaSorda told reporters following a testimony outside the country’s House of Commons finance committee yesterday.

Chrysler directly employs more than 9,400 people in Canada and a further 25,900 through its dealerships. Including suppliers and retirees, it said 100,000 people depended directly or indirectly on its Canadian operations, which last year manufactured more than half a million vehicles.



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Comments (5)

  1. ma_GreyRazor avatar GreyRazor Posted: 3/12/2009 6:29am PDT

    Blackmail
     
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  2. ma_adamk avatar adamk Posted: 3/12/2009 7:21am PDT

    Mr. LaSorda: Perhaps what most jeopardizes your operations in Canada and elsewhere across North America is a toxic brew of mediocre engineering, shoddy quality control, out-of-touch marketing, and (yes) arrogant management tactics fueled by your private equity owners. Perhaps they will finally realize Chrysler doesn't much physical asset value and even less intellectual capital.
     
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  3. ma_SuperSkyline89 avatar SuperSkyline89 Posted: 3/12/2009 7:56am PDT

    If this is the game they want to play, then good, get the hell out and take someone else's taxdollars. Good riddance to inferior products and arrogant and out of touch management.
     
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  4. ma_AeroCars avatar AeroCars Posted: 3/12/2009 9:19am PDT

    Maybe Chrysler needs to be reminded of where they come from. ie Walter P. Chrysler was born in Windsor Ontario and got his start in Canada. And the Dodge Brothers were both from the Windsor area as well, and they started Dodge Trucks, in where else, Windsor Ontario, after leaving Ford. So maybe Chrysler should look at its roots to see why Canada plays a big role in their operations. If it wasn't for the Canadian auto industry back in the 1920's, they wouldn't be here.
     
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  5. ma_mitzo avatar mitzo Posted: 3/12/2009 9:30am PDT

    Is that old pickup truck and redneck muscle car company still pretending to be in business? Huh...
     
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