Wow, up to $13B and not that many Canadians to pay for this. What a load of
corruption our polticians have loaded onto to us. And for our American
buddies, that is on top of the $50B+ your taxes have added to this turkey.
Hell, no one even knows where all these tax-debt dollars are going, and the
public is too chickenshit to ask.
Might want to ask Harpo/Flaherty, Iggy and Laytoon why the Three Canadian
Stooges sold us out?
And it appears if you bought a GM lately, be careful, the warranty may be
void. Hope you got a good price as while they argue who covers the warranty
if anyone does.
Auto bailout: Why the plan won't work
The Canadian auto sector ran off the road and over a cliff in the first
quarter, dropping employment at vehicle assembly and parts plants to the
lowest level since the early '70s, when the Middle East oil embargo forced
the industry to slam the brakes on production. The good news, if you can
believe the political spin, is that at least 100,000 jobs will be saved
thanks to the $13 billion (and counting) that's coming out of Canadians'
pockets to try to save local operations of General Motors and Chrysler.
That number is ridiculous. "There are only about 100,000 manufacturing jobs
in the Canadian automotive sector," points out industry analyst Dennis
DesRosiers, "and two-thirds of them are tied to Ford, Toyota and Honda."
When GM is done downsizing, DesRosiers says, it will employ maybe 4,400
hourly Canadian workers. "Those jobs were indeed vulnerable," the analyst
admits, but to claim that job numbers in the six-figure range are being
rescued, as the Harper government is doing, "doesn't pass the laugh test,
even if you throw in Chrysler and all the suppliers and toolmakers."
In May, Canadian vehicle sales were down on a year-over-year basis for the
seventh month in a row. Car lots moved 154,000 units, up from 143,000 in
April, putting the seasonally adjusted annual sales rate at about 1.45
million vehicles. Last year, total sales in this country were 1.6 million.
Canadian auto manufacturing is of course heavily tied to the United States,
where the annualized selling rate hit 9.91 million units last month - which
allowed most automakers to report their best month for 2009. But
year-over-year numbers are still ugly. Japanese automakers posted worse
results than GM's 29% decline and Ford's 24% drop. Toyota posted a 38%
decline; sales at Nissan and Honda fell 33% and 39%, respectively. Chrysler
sales were off 47%.
Yet despite the stabilization of U.S. sales, not to mention the
taxpayer-funded bailouts of GM and Chrysler, there is very little chance the
Canadian sector will ever top its 157,130 peak employment in 2001 - when
total North American sales of cars and light trucks were around 20 million.
According to Statistics Canada, auto manufacturing jobs in this country
crashed by about 20%, reaching 99,684 in the three-month period ending March
31. But the Q1 figures do not account for the recent downsizing of GM and
Chrysler operations, so that number will go even lower. As well, the
recently increased value of the loonie might already have wiped out most, if
not all, of the cost savings GM and Chrysler gained from concessions made by
the Canadian Auto Workers, when the troubled Detroit duo renegotiated
contracts to try to make local operations more competitive.
Meanwhile, DesRosiers and other industry watchers say aggressive competition
from solvent automakers, not to mention government involvement in product
planning and plantlocation decisions, could seriously hinder attempts by GM
and Chrysler to stabilize their operations. That would probably lead them
back to the public trough - especially given the way private-sector lenders
have been treated by Washington and Ottawa during the restructuring process.
And every bailout dollar handed to these industry dogs hurts the stronger
North American operations of offshore-based players while making it more
likely that Ford will eventually hit a wall.
In short, relatively few Canadian jobs have been saved, and a lot more
bailing may be required to keep the shrinking Big Three from running off the