On December 5th, General Motors of Canada responded to letters sent a week prior by Minister of Industry Tony Clement and Minister of Economic Development Michael Bryant concerning potential government assistance to ensure national automotive sustainability. As a result of the bailout more than two months ago, GM and others in the North American auto sector have been scrambling to respond to the impacts of the global credit crisis on auto sales, both in the U.S. and Canada. GM Canada hopes to seek government liquidity assistance as a result of restructuring investments from unavailability of private credit and a low cash position.
“GM Canada is just completing a $4 billion transformational investment program in Canada, initiated in 2005, toward becoming a lean, green and more sustainable business. Regretfully, North American economic conditions now make it necessary for us to seek government assistance to sustain our business and supply chain.”
GM’s transformation work to date includes major investments in its current offering of the latest ’09 hybrid models, to which GM plans to be the first to build hybrid cars in Canada. As a private wholly-owned company, GM Canada acknowledged the need for transparency and accountability and will also be providing governments with additional financial and competitive information under appropriate confidentiality provisions.
“We will also work together with all our key stakeholders to review and agree to further necessary changes to our business model, including our capital structure, structural costs, pensions and health care costs to ensure sustainability within GM’s integrated North American business.” General Motors of Canada (GMCL) is headquartered in Oshawa, Ontario and employs 12,000 people nationwide including approximately 700 dealerships and retailers across Canada.