Though thousands of Canadians work in the auto industry, their country has no car companies of its own. That’s why Prime Minister Stephen Harper said that Canada had to contribute billions to the recent bailouts of General Motors Company and Chrysler Group LLC. If it didn’t kick in, Harper warned that his country risked losing jobs to the United States.
On June 1 Harper announced that Canada would extend $6.2 billion in aid to GM, and the province of Ontario would give another $3.2 billion. In exchange, Canadian taxpayers now own 12 percent of the restructured GM. The company has agreed to maintain the Canadian proportion of its North American manufacturing capacity at 16 percent. GM has also promised to use some of the Canadian funding to boost research and development, and to launch five new vehicles. Under the deal, GM did not file for bankruptcy protection in Canada, but settled out of court with stakeholders who agreed to the restructuring plan.
