The collapse of the Big Three automakers would be catastrophic to Canada's economy, with nearly 600,000 jobs expected to disappear in the country within five years, according to a report released Tuesday.
The report was prepared for the Ontario Manufacturing Council, an advisory panel of industry and labor representatives.
It predicts that effects on employment would be felt right away, with Canada losing 323,000 jobs if production ceased immediately, 281,800 in Ontario province alone.
Those figures would climb in five years to 582,000 jobs nationally in 2014, 517,000 of those in Ontario.
A cut in production by 50 percent would eliminate 157,400 jobs nationally immediately, 141,000 in Ontario. By 2014, 296,000 jobs would be lost, 269,000 in Ontario.
The depreciation of the Canadian dollar, lower interest rates and lower production costs will eventually help the economy to partially recover but the loss of the Detroit Three will leave a permanent dent in Canada's economy in terms of jobs and output, the document says.
The collapse of the Big Three would have far reaching effects, including a reduction in production by the Canadian automotive parts industry of 80 percent, the report predicts.
The Canadian subsidiaries of the Detroit Big Three automakers had asked Ottawa and Ontario for financial aid that could total as much as 6 billion Canadian dollars (US$4.8 billion).
Last Friday, the federal government and Ontario reached a deal to offer 3.5 Billion Canadian dollars to Canada's auto industry, provided that the U.S. would eventually approve a proposed US$14-billion aid package.
(Xinhua News Agency December 17, 2008)
