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