Saturday, December 20, 2008

Canada approves bailout for U.S. automaker subsidiaries

Canada's announcement Saturday that it was offering $4 billion in emergency loans to subsidiaries of failing U.S. automakers must have been good news in Detroit, Michigan, where General Motors, Ford and Chrysler have their headquarters. The announcement by Prime Minister Stephen Harper and Ontario Premier Dalton MgGuinty came the day after U.S. President Bush announced a $17.4 billion rescue plan for the industry, according to the Reuters international news service. Harper said Saturday that the cost of the industry's complete collapse in Canada was too high. "There are literally across the country hundreds of thousands if not millions of potentially affected families by the distress of this industry," Harper said. "And we are obviously making sure at this Christmas time that, within the confines of our responsibility for taxpayer money, that we are also going to look after their interest." Failure of the U.S. automakers would cost 600,000 jobs in Canada, mostly in Ontario, within five years, according to a provincial advisory panel. Harper said his government would not allow the U.S. automakers to close their Canadian operations. Harper also said he was assured by Bush and incoming U.S. President-elect Barak Obama that they would not let the companies fail. "We may well have much smaller companies but they will not fail in my judgment," Harper said. "The question then for Canada is to ensure that as they are restructured that we retain our market share." The Canadian bailout package also included help for auto parts suppliers and better access to credit for consumers, Reuters said.

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