Ontario Premier Dalton McGuinty is playing down threats by Chrysler to pull out of Canada, even as the troubled automaker and its union appear to be headed for a standoff that could derail a multibillion-dollar government bailout.
McGuinty suggested late Thursday that there was no need for him to intervene personally to help the two sides come to an agreement.
The province and federal governments are in talks with Chrysler, which is where the "important discussions" are taking place, he said.
"Some things are said from time to time to the media -- and I understand that," McGuinty said after speaking at a posh fundraiser that raised $2 million for the Ontario Liberal party.
"But the real work is being done in (that) room. I'm still feeling positive about those discussions."
Chrysler president Tom LaSorda said Wednesday night that the automaker could shut down its plants in Canada -- putting about 10,000 people out of work -- if it doesn't get significant labour concessions and about US$2.3 billion in aid from Ottawa and Ontario.
But Canadian Auto Workers president Ken Lewenza said his union will "absolutely not" concede more to Chrysler than it did to General Motors, a deal LaSorda described as "unacceptable."
Ontario Economic Development Minister Michael Bryant said Chrysler was simply laying out its worst-case scenario.
"I know Tom LaSorda, he's a great Canadian and he's not somebody who wants to be known as they guy who shut down Chrysler," Bryant said.
"It was a ham-fisted way of expressing the reality that, in the absence of an agreement, Chrysler's going to face critical challenges."
There is a bailout deal to be had as long as Chrysler can prove it has a viable business plan, he added.
LaSorda's comments simply laid out the interests of investors and are part of ongoing discussions -- they were not meant to imply Chrysler doesn't want to be in Canada, Bryant said.
"This is a negotiation, and yesterday was part of that negotiation," he said.
"I want to assure the workers and people who live in the communities where Chrysler cars are made and auto parts are produced that we can come to an agreement if Chrysler can prove itself to be viable and it wants to remain in Canada, and I know that it does."
The government's key priority is keeping production and jobs in Ontario, and it will continue to act in the public interest, Bryant added.
He also cast aside questions about whether Chrysler's threat was intended to prompt Ottawa to throw out a $500-million charge it laid against the company as part of a high-stakes tax battle.
Those tax issues are not of part of Ontario's negotiations, Bryant said.
Ontario and Ottawa have been working with GM and Chrysler after the struggling companies asked for an aid package to help them survive the economic downturn.
Members of the Canadian Auto Workers union have already approved a new cost-cutting contract with General Motors.
In his speech late Thursday, McGuinty expressed confidence that Ontario's auto industry will survive the current downturn and be a part of the province's "post-recession" economy.
"We value a smart economy, one that competes more and more on the basis of value-added innovation, including innovation in our traditional sectors: auto, manufacturing, agriculture, forestry, mining," he told over 2,000 party supporters, which included federal Liberal Leader Michael Ignatieff and former prime minister John Turner.
"Now, building that powerful economy is one tall order, but we're not intimidated by our challenge. We're Ontario."
But it's "hard to say" when Ontario will recover or if it will ever return to the rate of economic growth that it saw in years past, McGuinty said afterwards.
"Everybody agrees that this recession will, at some point in time, come to an end," he said.
"There is no doubt about that whatsoever. The only issue is when."
The March 26 budget will help people who have been hurt by the recession and lay out a plan that will make the province more competitive once the economy recovers, he added.
