A group of Ontario mayors wants to see Queen's Park and Ottawa move quickly on supporting North American automakers in the province.
They called Friday at a meeting in Toronto for a "made in Canada" solution to the problems faced by the Big Three -- Detroit-based General Motors of Canada Ltd., Ford Motor Co. of Canada Ltd. and Chrysler LLC.
No help would mean the collapse of the industry -- and that would hurt their communities and the province, said the group of about 30 mayors, which bills itself as Ontario Mayors for Automotive Investment.
"The loss of an assembler has a ripple effect throughout the whole economy of Ontario, because at least five to seven jobs that are directly affected by automotive, never mind the capacity for manufacturing in general," said Mayor Michael Harding of Woodstock, which hosts a Toyota plant.
The mayors are pushing for loan guarantees to help the companies cope with the credit crunch -- the tight restrictions on lending that are throttling both consumers and businesses. Mayor Rob Burton of Oakville, which hosts a Ford plant, called the credit cruch a "cancer in our economy."
However, they didn't put a pricetag on the initiative.
Provincial Finance Minister Dwight Duncan agreed the priority should be keeping the automakers afloat in the short term by helping them through the credit crisis and then allowing the companies to adjust to the new realities of the marketplace.
Some in the public believe that helping the North American automakers -- who have stuck with large, gas-guzzling products such as pickup trucks -- would be throwing good money after bad.
Finance Minister Jim Flaherty, who represents Whitby-Oshawa, said recently that people in his riding were telling him they oppose a bailout.
"Within the public, there seems to be an attitude that 'you're bailing out the Big Three dinosaurs,'" said Mayor John Gray of Oshawa, where GM has been building vehicles for more than a century.
"And that's not the case. When you look at the amount of money they've been spending lately on research and development, over the last four years, I believe about four billion dollars. That's significant."
GM announced Friday it would be closing its Oshawa light truck plant in May, months earlier than had been expected. The closure will eliminate 2,600 jobs.
The provincial government puts the auto industry's contribution to the provincial economy at $28 billion annually, supporting 400,000 jobs and 12 communities.
Mayor Eddie Francis of Windsor, a city hit hard by auto industry layoffs, said the ripple effect of a single plant closure would likely affect a total of 42,000 jobs.
"Everything from automotive to the service industry, from hospitality to tourism," he said.
Auto dealers
The Canadian Automobile Dealers Association also urged the federal government to act quickly to help the auto industry or risk a crisis that will affect Canadians from "coast to coast."
CADA President and CEO Richard Gauthier, representing the country's 3,500 car dealers, told journalists at an Ottawa news conference that a aggressive federal policy is desperately needed.
"The Canadian public and policymakers need to understand that the auto industry is really the engine of the entire country's economy and not just a single province," Gauthier said.
"As the largest contributor to Canada's manufacturing Gross Domestic Product and responsible for one in seven jobs nationwide, the auto industry is crucial for our economic structure."
He said the current automotive manufacturing downturn will have a ripple effect in every community across Canada.
"The cold reality facing decision makers today is that if Canadian-based manufacturers are not provided a bridge across the current economic crisis, then Canada's 3,500 small business dealers, located in every community in the country, will bear the brunt of the downturn," he said.
"...As economic cornerstones of almost every community in Canada, the pain of auto dealers will be felt on main streets and other small businesses from coast to coast."
CADA wants Ottawa to consider measures to increase liquidity in the automotive sector.
In the U.S., the Detroit Three -- Ford, Chrysler and General Motors -- are currently seeking $25 billion from Congress to prevent their collapse.
On Thursday, Industry Minister Tony Clement and Ontario Economic Development Minister Michael Bryant were in Washington meeting with top-level officials to discuss the best deal with the crisis.
The federal government pledged "further support" for the auto industry in Tuesday's throne speech, but it isn't expected until the next budget, likely to be delivered in March.
With a report from CTV Toronto's Paul Bliss and files from The Canadian Press
