Five hundred GM Canada workers in Oshawa face temporary layoffs in the new year, part of a cost-cutting measure announced by GM Corp. in Detroit that will see 3,600 layoffs company-wide.
Oshawa is GM Canada's single-largest operation, with about 5,000 workers.
GM Canada has previously announced plans to shut down its Oshawa truck plant next fall, which will eliminate 2,600 jobs, and close a Windsor transmission plant, which will cost 1,400 jobs.
Ken Lewenza, president of the Canadian Auto Workers, said Friday the effects of the job cuts will radiate far beyond the company's plants.
"We're analyzing what this means to the auto parts sector in Canada," he said. "The trickle-down effect hasn't been fully investigated yet, but you can assume there's going to be job losses there too."
Lewenza also fears there may be more bad news in the coming months.
Friday's announcement came as GM said it lost $2.5 billion in the third quarter.
The numbers were seen as "reflecting rapidly deteriorating market conditions in the U.S., slowdowns in other mature markets around the world, and continued losses at GMAC Financial Services," GM said.
Total sales in October had dropped 45 per cent -- they held in Canada, but 90 per cent of Canadian auto production goes to the U.S. -- while Ford Motor Co. reported a 30 per cent sales drop.
The news from GM came only hours after Ford released its own grim financial update earlier in the day.
The Ford Motor Co. said earlier Friday it lost $129 million and spent $7.7 billion in cash in the same period. It will chop 10 per cent of its worldwide salaried workforce and will likely carry out other moves to cut production and labour costs.
"Obviously it's not good news out of any of the auto manufacturers. It's about consumer confidence in the United States and I hope they can get it turned around because if they can't, it's going to hurt us even more if we don't get that consumer confidence back," said Oshawa's Mayor John Gray.
Gray suggested a government bailout shouldn't be ruled out since the industry is vital to the nation's economy.
He said the industry simply needs help to get through a difficult period.
"I look at what the automotive manufacturers are doing right now, the innovations they're doing, the products they're going to be coming out with in just a few short yeas," Gray told CTV Toronto.
"But we have to get them to that point and that really mandates that the government needs to step in and provide some loan guarantees, because with these numbers they're not going to be able to get a cent from anybody."
Still, even veteran auto workers at the Oshawa plant, which ships 85 per cent of its product to the U.S., fear they could be laid off.
"It is possible, anything's possible, everyone is living on the edge," 20-year auto worker Bob Bawdy told CTV Toronto's Austin Delaney Friday.
Other workers expressed similar worry about their future at the Oshawa plant.
"Well, everyone's on pins and needles, I mean there's been so many lay offs," said another worker who declined to give his name. "It's not a good feeling."
Meanwhile, the U.S. slowdown has sent shockwaves throughout Canada's auto industry.
Earlier this week, about 250 workers at Magna plants throughout the Greater Toronto Area were told they would be laid off on Dec. 23.
Plants in Newmarket, Bradford and Vaughan will be affected as Magna posted its first net-quarterly loss in 17 years.
With files from CTV Toronto's Austin Delaney and files from The Canadian Press
