The US government had barely announced aid for GM and Chrysler tier one suppliers last night before its counterpart north of the border chimed in to say it welcomed the US plans and, by the way, already had a similar programme for Canadian parts suppliers.
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“We’ve had something in place for some time now. There’s an auto receivables package that our suppliers use through EDC [government agency Export Development Canada],” Darren Cunningham, spokesman for industry minister Tony Clement told Reuters.
EDC provided C$3.2bn (US$2.6bn) at current exchange rates) in receivables insurance to the auto industry last year, according to the spokesman.
“It’s primarily used by suppliers to the Detroit Three,” Cunningham said.
The programme enables Canadian parts suppliers such as Linamar and Magna International to take their government-insured receivables to a bank and use them as security when applying for immediate financing.
Cunningham said the new US aid was “a positive, obviously. Whatever helps spur the American auto market invariably helps Canadian assemblers. We put 85% of our product to the states, so whatever’s good to get the industry moving again, we’re certainly supportive.”
