An appeal for fresh support came in the form of a letter to the governments of Canada and Ontario from the Canadian Vehicle Manufacturers' Association, representing General Motors Corp, Ford Motor Co, and Chrysler in Canada.
"With the global financial liquidity crisis and the collapse in the U.S. consumer market, Ontario's auto industry, which exports 85 to 90 percent of its finished product into the U.S. market, is struggling for survival," read an excerpt of the letter published in the Globe and Mail newspaper.
The federal government reacted coolly to a similar request made late in October by the auto parts industry, but it has since opened the door a crack to possible assistance in a number of different sectors.
"We're not closing the door absolutely on a number of these questions, but I think one has to recognize the fiscal situation that we're in as well," said an aide to Harper, speaking to reporters on condition he not be identified.
He said the government would ask itself: "Is it fiscally responsible? Is this actually a long-term solution or is it a Band-aid that won't actually ultimately change the outcome of the events that are happening in the economy?"
Ottawa also has to balance competing demands from a number of industries. It is in the consulting phase now and has not made specific decisions, he said.
He said the prime minister is "very concerned about the auto sector right now."
A spokeswoman for Ontario Premier Dalton McGuinty said the auto industry's letter, dated Nov. 5, had been received, but that she could not give more details.
When the auto parts industry asked for C$1 billion ($850 million) in emergency funds and loan guarantees a little under two weeks ago, the federal government said it had already made money available more broadly through its agencies.
It said it had authorized a C$2 billion increase in the borrowing capacity of Export Development Canada and that the Business Development Bank was also taking additional measures to improve liquidity.
In the United States, the chief executives of GM, Ford and Chrysler met Thursday with U.S. House Speaker Nancy Pelosi and Senate Majority Leader Harry Reed to make their case for up to $50 billion in government aid.
Ford said Friday the company as a whole burned through $7.7 billion in cash in the third quarter because of production cuts, operating losses and consumer incentives. The automaker reported a net loss of $129 million, but excluding one-time items, the loss from continuing operations ballooned to $2.98 billion.
GM said it had a $4.2 billion operating loss and burned through $6.9 billion in cash. It said it sees liquidity falling significantly short in the first two quarters of 2009.
Chrysler does not release financial information.
($1=$1.18 Canadian)
