GM Canada to Cut 5,900 Jobs by 2014

Number is nearly 60% of workforce in Canada

The Canadian branch of General Motors said on April 27 it would cut 5,900 jobs in Canada by 2014 -- nearly 60% of its workforce here -- in a restructuring bid.

The Canadian branch said it plans to slash its workforce to 4,400 by 2014, down from 10,300 last year.

The measures came as the company announced a fresh U.S. viability plan that featured a debt swap to give effective control of the automaker to its main union and the U.S. government.The president of GM in Canada, Arturo Elias said the changes announced in the U.S. plan would also help streamline Canadian operations.

"Many of the operational changes... will also enhance the viability of our highly integrated Canadian operations as we complete our discussions with the Ontario and federal governments on GM Canada's restructuring plans," he said.

GM Canada said it expects to soon complete a short-term bridge loan deal with the federal government and the Ontario government to receive up to three billion Canadian dollars (US$2.5 billion) to help facilitate its restructuring plans.

GM also plans to reduce the number of its dealers in Canada by 42%, from 705 today to between 395 and 425 by the end of 2010.

The automaker said it expected a new round of discussions with the Canadian Auto Workers (CAW) union to start "in the days ahead," and is likely to result in the same concessions the union granted to Chrysler in an agreement ratified on April 26.

Three of the six new models GM will launch in the U.S. this year will be assembled in Canada.

GM Canada is set to account for 16% to 17% of the automaker's North American production by 2014, down from 18.4% this year.

The ailing automaker has until May 30 to submit a new restructuring plan to the Canadian government to secure financial assistance.

Copyright Agence France-Presse, 2009

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