Create a free Manufacturing.net account to continue

Chrysler, CAW Close To Deal?

Ontario's economic development minister says there's progress in talks between the Canadian Auto Workers union and Chrysler, and an announcement could come Thursday.

TORONTO (AP) -- Talks between the Canadian Auto Workers and Chrysler are showing progress and an announcement could come Thursday, said Ontario's economic development minister.

Michael Bryant said he spoke with CAW President Ken Lewenza, who confirmed talks are advancing.

"I left the conversations with labor and management with the sense that they were closer to an agreement on cost savings, closer to an agreement on the viability of the company," Bryant said.

Bryant said the governments of Ontario, Canada and the United States will also talk Thursday about support for the struggling automaker. But he cautions that many more steps must be taken before a final bailout deal can be achieved, including an agreement between Chrysler and its U.S. workers.

Chrysler LLC has been given until the end of April to provide a viable restructuring plan to the U.S. and Canadian governments to qualify for government loans.

As part of Chrysler's viability plan, the struggling automaker is in partnership talks with Fiat. The Italian automaker's chief executive, Sergio Marchionne, said Thursday that Fiat has an has an "unwavering commitment" to the proposed alliance.

Without a deal, Chrysler will not receive long-term government aid, and may be forced to file for bankruptcy protection or even liquidate its assets.

"In the event there was a filing, receivership protection, they would need dollars to keep the operations going, not unlike the bridge loans that have been provided by the governments to date," Bryant said.

"Because the financing is very difficult to get in the current circumstances, inevitably they'd be turning to the government for that assistance, by which I mean the U.S. government and the Canadian government," he said.

He denied reports that federal and provincial officials could provide as much as $6 billion to see the two companies through the early stages of bankruptcy protection.

"The range has not been determined as to exactly what would be needed. We'd have to have specific discussions," Bryant said.

More in Labor