Topic: Without concessions, Chrysler may close Canadian plants

[articsteve]

I say let Chrysler walk and put the money into GM only IF they are forced into a managed restructuring.

Much better offering Ford, Hyundai, et al,  X Billion along with the CRA seized Brampton plants.


Globe and Mail Update

March 11, 2009 at 10:29 PM EDT

OTTAWA — Chrysler LLC will have to pull its production out of Canada unless governments and unions meet its demands for financial assistance and cost reduction, company president Tom LaSorda has told MPs.

In a committee hearing, Mr. LaSorda said Chrysler would maintain roughly a quarter of its North American production in Canada if Ottawa provides $2.3-billion (U.S.) in loans and the unionized workers slash wages and benefit costs by nearly 25 per cent.

He added Canada Revenue Agency must agree not to demand further cash or collateral in a tax fight with Chrysler, in which the agency has already placed a $500-million lien on its Brampton plant and withheld $300-million in tax rebates.

“The current success and long-term viability of Chrysler's manufacturing operations in Canada is very much dependent on [those] three critical factors,” the Detroit-based executive told Members of Parliament.

 “Chrysler LLC cannot afford to manufacture products in a jurisdiction that in uncompetitive relative to other automotive jurisdictions.”

Mr. LaSorda said Chrysler recently closed a minivan assembly plant in St. Louis, and could move production of minivans from Windsor. He said models that are currently being made in Brampton - or being planned - could be moved to facilities in the U.S. or Mexico.

He said Chrysler's labour costs are $70 (Canadian) an hour in wages and benefits for both active workers and retirees and need to be cut by $20 an hour to be competitive with American and foreign car makers in the United States.

Chrysler asked the U.S. government for $9-billion (U.S.) in loans to keep it operating as North American car sales have cratered. The company said it has a plan to survive the downturn, but needs the assistance of government, its workers, suppliers and creditors. and the

“The bottom line is we needed to be very very clear - ambiguity doesn't help the process,” the auto executive told reporters after the meeting. These are things that Chrysler needs . . we know they can be addresses. The sooner the better, and we'll be here for a long time once they are addressed.”

[Leviathan]

I say let Chrysler walk and put the money into GM only IF they are forced into a managed restructuring.

I actually agree with you on this  I feel so dirty...

[articsteve]

feel   

[initial_D]

Let them eat K car.

[ovr50]

Screw Chrysler, they are not making the right moves to save themselves, and the equity players, Cerberus, who own them are financial thugs. Let the thing fail, let Cerberus total up it's losses on this bad deal, and let the rest of the auto world go on without Chrysler. It is not the end of the world, even in self-important Ontario.

I certainly don't wish to see Cdn taxpayers money going to bail out Cerberus. 

And don't cry Chryler jobs until you recognize that the workers of Western Canada are not being bailed out - forestry, oil and gas construction, residential construction workers. Nor are the miners in Snowy's Sudbury getting bailed out.

GM is worthy of saving, Chrysler not so.

 

[Trainman]

Wow, what a great way to build a working relationship, with threats      Sounds too much like the same old same old.  I say call their bluff and if they walk, so be it.

[carcrazy]

I hate the tone Chrysler used in more than one occasion. I find $2.3B way too much to save 8000 Canadian workers. The government could use the money to assist the laidoff workers one way or another.

[sailor723]

Taking Chrysler out of the picture would go a long way towards removing some of the excess capacity in the business. Far better to use the money to attract viable car companies to start and/or increase production in Canada

[tpl]

Let them walk. If they do survive outside Canada then any vehicles they import will be subject to the 6% tariff.

Threatening sovereign governments is a job best left to other governments.

[sailor723]

Let them walk. If they do survive outside Canada then any vehicles they import will be subject to the 6% tariff.

Threatening sovereign governments is a job best left to other governments.

I don't disagree with "let them walk" but I don't get the 6% tariff thing. Aren't Chrysler's other plants in the US and Mexico and thus fall under NAFTA ?

[tpl]

Sad but true.... I must have had a brain fart

[Thinking Out Loud]

More likely the reality:

Without concessions, Chrysler will close.  Canadian plants.  US plants.  Mexican plants.

Tommy's threats mean little coming from a company that likely will cease to exist.  Period.

A$$.

[toolatecrew]

He added Canada Revenue Agency must agree not to demand further cash or collateral in a tax fight with Chrysler, in which the agency has already placed a $500-million lien on its Brampton plant and withheld $300-million in tax rebates.

See ya. Try to blackmail Canada Revenue? That's a no no.

[Winklovic]

Vayo con dios, Chrysler.

Edit: I emailed my MP, the PM and the FM, telling them that I don't approve of the bailouts.  I wonder if I'll get a response.

[marineboy]

I wonder if Lee Iacocca will come out the sky in a Superman outfit and save the day...

[airbalancer]

Could they make Eagle Premier there again

Why would Hyundai come back to Canada?

[Patate]

I hate the tone Chrysler used in more than one occasion. I find $2.3B way too much to save 8000 Canadian workers. The government could use the money to assist the laidoff workers one way or another.

it's 100 000 jobs including the indirect jobs.

its around 30 000 direct jobs if you include the dealers, and plants create lots of indirect jobs.. suppliers, contractors, and all the service jobs around them.

[Ottawa]

I hate the tone Chrysler used in more than one occasion. I find $2.3B way too much to save 8000 Canadian workers. The government could use the money to assist the laidoff workers one way or another.

it's 100 000 jobs including the indirect jobs.

its around 30 000 direct jobs if you include the dealers, and plants create lots of indirect jobs.. suppliers, contractors, and all the service jobs around them.

No bailtout will be large enough to fix the long term viability of Chrysler. Good ridance!

[Erik]

I am of two minds in this.
While I did not like the tone, I did appreciate the fact that he was actually levelling with us. He gave us the cost and the result of not supporting Chrysler.

Of course, he only spoke of the direct jobs at Chrysler.

Thanks to Patate for giving us the big (real!) picture.

[rrocket]

It's mainly because of the minivan plant sitting idle in the USA.  By FAR the minivan is Chyslers best selling product.  With the bailout money in the US, people are pissing and moaning that St. Louis is sitting idle while the CDN minivan plant is up and running.  Heck..they might close the Windsor plant anywas....this might be a way for them to squeeze a few extra $$ out of the government before they do...