TORONTO — Canada's auto parts makers are calling for a $400-million emergency cash injection from the federal and Ontario governments.
The Automotive Parts Manufacturers' Association of Canada says the loans — aimed at smaller companies — are needed to save Canada's largest export industry.
Association president Gerry Fedchun has told the Globe and Mail the meteoric rise in the Canadian dollar is an extraordinary burden, and he wants the federal government to put policies in place to clip the loonie's soaring wings.
Fedchun sent two letters to federal Industry Minister Jim Prentice and Ontario Economic Development Minister Sandra Pupatello last week.
He will meet with Ontario officials today and hopes to meet federal officials later this week to discuss the issue.
The industry, which employs 90,000 people mainly in Ontario and Quebec, has been squeezed by declining production and price cuts at Ford Motor Company, Chrysler and General Motors.
''Our industry is facing its biggest challenge in 30 years and extraordinary measures are required to save Canada's largest export industry,'' Fedchun said in an interview. ''This is an emergency.''
The rise in the dollar arrived after Canadian parts makers — which manufacture more than $30-billion worth of goods and services annually — had already been battered by other woes that have led to dozens of plant closings and thousands of job cuts.
The loans would be used by parts makers mainly to buy equipment to make them more productive, Fedchun said. But in seven months, the Canadian currency has risen to more than US$1.00 from 85 cents, and it's impossible to order new equipment and install it in that period of time in order to boost productivity, he said.
''There are certainly some (companies) in danger of going out of business, either quickly or slowly,'' he said of his 400 members.
Fedchun said any financial assistance would be aimed at smaller Canadian companies that don't have the same ability to raise money as Linamar, Magna and Martinrea.