Canada’s federal government and Ontario’s provincial government have set a deadline of Friday for struggling US-based automakers seeking financial support to provide detailed financial information and a restructuring plan for their Canadian subsidiaries.
The letter, signed by federal Industry Minister Tony Clement and Ontario Economic Development Minister Michael Bryant, was sent on Friday to General Motors, Ford and Chrysler.
All three automakers have pleaded to the US and Canadian governments for substantial financial aid to stave off bankruptcy and avert the loss of hundreds of thousands of jobs.
Their chief executives are heading back to Washington on Tuesday to show their restructuring plans to US lawmakers. Congress is expected to vote on whether to give them US$25 billion in government-backed loans the following week.
Clement and Bryant’s letter asks the Canadian subsidiaries to reveal their production plans, including how they will “ensure” that energy efficient cars are being made in Canada.
“Taxpayers deserve that these companies detail solid plans for a prosperous future in Ontario, and I’m confident we’ll get that,” Bryant said.
An analysis of “Canadian and Ontario competitiveness vis-a-vis your global operations, including each major component of your cost structure, and how it can be adjusted to ensure our competitive position going forward” is required, the letter states.
“Before we consider committing taxpayer dollars, the government needs to see solid, sustainable plans from the automakers as they pertain to Canadian operations,” Clement said.
The automakers must also provide an analysis of its Ontario pension liability, it said.
Clement and Bryant were in Detroit and Washington last week to meet with auto executives to discuss a possible US bailout for the battered industry.
Should the North American auto industry collapse, hundreds of thousands of jobs in both the US and Canada would be threatened.
GM said on Friday it would sell and lease back some of its non-manufacturing operations in Europe as part of its efforts to raise cash quickly.
The company’s European division has retained real estate agent Jones Lang LaSalle to help identify potential buyers. The company has the potential to raise about US$257 million.
“Investigations are under way as to what would be viable,” said Denis Chick, spokesman for GM’s United Kingdom and Ireland division in an e-mail on Friday.
According to Chick, properties in the UK that could be sold include its headquarters in Luton, a parts warehouse in Luton and an engineering site in Millbrook.
GM has also delayed multiple projects, including new vehicles and engines, in order to cut costs. Earlier this month the company said it would sell its 3.02 percent stake in Suzuki Motor Corp for US$230 million.
The company is burning through cash more rapidly than it is making money, and may be at its minimum cash levels by the end of the year. GM is banking on swift congressional approval of taxpayer-backed bridge loans. Company executives are currently preparing a viability plan to present to Congress by Tuesday.
UNPRECEDENTED PACE: Micron Technology has announced plans to expand manufacturing capabilities with the acquisition of a new chip plant in Miaoli Micron Technology Inc unveiled a newly acquired chip plant in Miaoli County yesterday, as the company expands capacity to meet growing demand for advanced DRAM chips, including high-bandwidth memory chips amid the artificial intelligence boom. The plant in Miaoli County’s Tongluo Township (銅鑼), which Micron acquired from Powerchip Semiconductor Manufacturing Corp (力積電) for US$1.8 billion, is expected to make a sizeable capacity contribution to the company from fiscal 2028, the company said in a statement. It would be an extended production site of Micron’s large-scale manufacturing hub in Taichung, the company said. As the global semiconductor industry is racing to reach US$1 trillion
ABOVE LEGAL REQUIREMENT: The Ministry of Economic Affairs is prepared if LNG supply is disrupted, with more than the legal requirement of 11 days of inventory Taiwan has largely secured liquefied natural gas (LNG) supplies through May and arranged about half of June’s supply, Minister of Economic Affairs Kung Ming-hsin (龔明鑫) said yesterday. Since the Middle East conflict began on Feb. 28, Taiwan’s LNG inventories have remained more than 12 days, exceeding the legal requirement of 11 days, indicating no major supply concerns for domestic gas and electricity, Kung said at a meeting of the legislature’s Economics Committee in Taipei. The ministry aims to increase the figure to 14 days by the end of next year, he said. While one or two LNG or crude oil shipments for May
Taiwan’s food delivery market could undergo a major shift if Singapore-based Grab Holdings Ltd completes its planned acquisition of Delivery Hero SE’s Foodpanda business in Taiwan, industry experts said. Grab on Monday last week announced it would acquire Foodpanda’s Taiwan operations for US$600 million. The deal is expected to be finalized in the second half of this year, with Grab aiming to complete user migration to its platform by the first half of next year. A duopoly between Uber Eats and Foodpanda dominates Taiwan’s delivery market, a structure that has remained intact since the Fair Trade Commission (FTC) blocked Uber Technologies Inc’s
Memory chip stocks extended their losses yesterday after Alphabet Inc’s Google publicized research that could allow more efficient use of the storage needed for artificial intelligence (AI) development. SK Hynix Inc and Samsung Electronics Co, South Korean leaders in the market, fell more than 6 percent and about 5 percent respectively in Seoul. In the US, Micron Technology Inc, Western Digital Corp and Sandisk Corp slid more than 2 percent in pre-market trading, after they all closed lower on Wednesday. Memory companies have been on a tear in recent months as the rapid development of AI infrastructure triggered a spike in chip
RSS