Chrysler to keep Canada plants without government help
By Rob Gillies, AP
March 6, 2014, 12:10 am TWN
TORONTO--Chrysler said Tuesday it will take steps to build new cars and minivans in Ontario without incentives from the provincial and federal governments and is withdrawing requests for financial aid for plants in Windsor and Brampton because the projects have become a “political football.”
Chrysler now builds minivans at the Windsor plant and big cars in Brampton.
Chrysler has been talking to the federal and provincial governments about an incentive package that will help offset higher wages in Canada and allow for a major upgrade to the two plants.
The company said that it will start the process of upgrading the Canadian factories with its own capital. But spending the money will depend on Canada's competitiveness with other global factories.
“The thing I really regret most about this issue in Canada and province of Ontario is that unfortunately it has been picked up as a political football in the country. It is being bandied around as if it has become an ideological albatross,” Fiat Chrysler Automobiles chief executive Sergio Marchionne told reporters in Geneva at the Geneva Auto Show on Tuesday.
Ontario is facing a possible election this year and opposition Conservative leader Tim Hudak has called Chrysler's aid request corporate welfare. Hudek has said Ontario is being held hostage and provincial Conservative lawmaker Jane McKenna said Tuesday there is a better way to create jobs.
Liberal Ontario Premier Kathleen Wynne has called the remarks “irresponsible” and said the province was aware that the car maker was also open to setting up shop the U.S. or other countries.
“We are surprised by this news because we have had good, productive discussions with Chrysler,” said Jason MacDonald, a spokesman for Canadian Prime Minister Stephen Harper. “Clearly Chrysler is concerned with the political situation at the provincial level. We remain committed to our automotive policy and the funding announced in the budget to help the sector remain competitive.”
Marchionne, a dual Canadian and Italian citizen, said he regrets doing a poor job explaining the competitiveness of manufacturing alternatives that are available to automakers in other jurisdictions. He said last month at the Canadian International Auto Show in Toronto that Canada must decide if it wants the plants, and that the United States and Mexico are desperate for the investment.