GM to invest in Ont. plant
Tuesday, June 1, 2010 at 10:47AM Announcement is on top of $235M April investment
General Motors is making a new investment in its St. Catharines, Ont., powertrain plant.
The company will make the announcement Tuesday morning at an event with Industry Minister Tony Clement, Canadian Auto Workers president Ken Lewenza and GM Canada president Kevin Williams.
A company spokesman said the funding is in addition to GM's recent engine announcement at the plant.
In April, the company said it would invest $235 million in the plant to secure up to 400 jobs.
The Globe and Mail reported that GM plans to produce a new, fuel-efficient transmission at the St. Catharines plant starting in 2012.
GM returns to profitability
The Detroit automaker earned $865 million US in its latest quarter, its first profitable quarter in nearly three years. The $1.66-per-share profit was far better than a loss of $6 billion, or $9.78-per-share, for the same period last year.
The $31.5 billion in revenue for the first three months of 2010 was up 40 per cent compared with the first quarter of 2009, when GM initiated temporary plant shutdowns in Canada and the United States.
GM Canada shed about 2,600 jobs with the closure of a truck plant in Oshawa, Ont., last year.
It also announced plans to shut down a transmission plant in Windsor, Ont., by the end of July, affecting more than 1,000 workers.
However, the company has announced the recall of hundreds of workers to its Canadian plants to meet strong demand for some of its products.
73% of GM is government-owned
The U.S. government still owns 61 per cent of GM, as a result of Washington's $45.3-billion US investment.
The Canadian federal and Ontario governments own about 12 per cent of GM, after they invested a total of $8.1 billion — two-thirds from Ottawa and one-third from the province.
The automaker received $52 billion from the U.S. government and $9.5 billion from the Canadian and Ontario governments, starting in 2008.
At first, the entire amount of U.S. aid was considered a loan as the government tried to keep GM from going under and further pulling down the fragile economy.
But during bankruptcy proceedings, the U.S. government reduced the loan portion to $6.7 billion and converted the rest to company stock.
Canadian governments also converted part of their debt to shares, reducing its loan balance to $1.4 billion.
The final instalments on those loans were repaid in April, comfortably beating a 2015 deadline.
Source: CBC News
Read more: http://www.cbc.ca/money/story/2010/06/01/ont-gm-st-catharines-100601.html?ref=rss#ixzz0pc49VSVm
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