November 25, 2008

Canada may lose 15,000 auto jobs

CANADA - An economist with the Conference Board of Canada believes the Canadian auto industry will lose a staggering 15,000 jobs by the end of 2009 as a "maelstrom" of change sweeps through the sector.

The latest projection from the non-profit research organization predicts Canada's automakers will lose $1.7 billion this year as new vehicle production declines by 15.3 per cent. The report said the automakers are caught in a "maelstrom of cyclical and structural industry changes" and it's a trend unlikely to improve until 2010.

Conference Board economist Sabrina Browarski said the drop is attributable primarily to reduced demand for new vehicles in the United States where production is expected to reach an eight-year low in 2009, adding up to another $1 billion in losses.

Browarski said the total damage will likely come to 15,000 lost jobs in the vehicle assembly sector alone, with even more expected at auto parts manufacturers and other spinoff industries. While the struggling industry is experiencing structural shifts, most of the negative trend in sales can be attributed to a cyclical slump in demand due to the American recession.

GM reported a $2.5-billion (U.S.) loss in the third quarter and Ford Motor Co. said it lost $129 million in the same period. Both GM and Ford have announced plans to lay off thousands of workers as they try to cope with plunging sales.

See Past Posts:

Volvo Cuts 1000 Jobs

Ford, General Motors & Chrysler running out of time

General Motors says its may go bankrupt

US Treasury rejects GM/Chrysler Merger Aid

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