Canada waited for the U.S. to unveil its own bailout package before announcing its plan to loan General Motors Canada up to $3 billion and Chrysler Canada up to $1 billion (The Canadian Press)

Ontario is working to find a way to protect its increasingly endangered auto jobs even though GM Canada is no longer seeking an emergency loan from the province, Economic Development Minister Michael Bryant said Wednesday.

The Ontario and federal governments are still negotiating a bridge loan for Chrysler Canada after promising in December to spend $4 billion to help the two struggling automakers.

But GM no longer wants that first, urgent portion of the aid package and is instead crafting a new plan to present to the government next week.

"The bridge loan that was announced by the prime minister and the premier in December is being pursued by Chrysler, not by GM," Bryant said.

"But the Part 2 to all this remains the same, which is to provide financial assistance in the event that all of the conditions are met for the companies to be viable and transformational in their approach."

During initial negotiations in the fall, Bryant had argued Canada should offer its aid ahead of the U.S. to ensure jobs were protected in Ontario.

Based on U.S. aid

But Canada waited for the U.S. to unveil its own bailout package before announcing its plan to loan General Motors Canada up to $3 billion and Chrysler Canada up to $1 billion — totals based on the U.S. aid and proportional to their Canadian production.

GM and Chrysler were supposed to get the Canadian aid in three instalments, with the first portion expected Dec. 29. Funding was then deferred until mid-January at the request of the companies, and GM now says it passed on the emergency loan because it was able to temporarily support itself "cost-saving measures and access to other facilities."

"We are now focused first on working with all our stakeholders in Canada to ensure we can make necessary changes to restructure and ensure a sustainable and viable business for the future," said GM spokesman Stew Low.

It's unclear whether the province has lost any negotiating power now that the initial threat of bankruptcy has passed for the automakers, and Bryant declined to speculate about how jobs may be affected by any new plan.

"There's an effort being made to co-ordinate with the United States, but I think it's important to keep in mind that the industry itself has an interest in keeping an appropriate Canadian presence," he said.

"I'm confident that between the industry and the Obama administration we'll be able to come up with something that makes sense for Canada."

Chance to secure jobs

GM's new plan could also mean a change to the $1.3-billion Ontario offered up for auto aid — a provision Premier Dalton McGuinty and Prime Minister Stephen Harper had warned about when the emergency loan was announced at the end of last year.

Canadian Auto Workers union president Ken Lewenza said he believes the province still has a chance to secure jobs, but expressed frustration at the lack of information and transparency involved in the process so far.

"Until we know what that U.S. [bailout] number is in a real sense, I don't think that at this particular time we've lost our bargaining chip," Lewenza said.

"But I can tell you that we are nervous because we haven't heard anything."

He said the union remains committed to "being part of the solution," but won't make any commitments until it sees the details of the agreements between the companies and the government.

"I can go in there tomorrow and make some compromises, but until we see the terms and conditions of the loan, we ain't doing nothing."

David Cole, chairman of the Ann Arbor, Mich.-based Center for Automotive Research, said Canada runs a risk of being left behind by coming to the table after the U.S. has secured its deal, especially since health-care agreements with unions south of the border could negate the value of Canada's free medical system.

'Comprehensive plan'

But he said that for the most part, the key to saving jobs will be in the restructuring plans GM and Chrysler present to government next week.

"How this is going to play out kind of depends on what products are made in Canada, what's not made, what components are," Cole said.

"Both Chrysler and GM are going to try to show a pretty comprehensive plan going forward that will put the company in the size that it needs to be to compete over the long-term, and that could put some Canadian facilities at risk beyond what was already announced earlier."

GM said Tuesday it will be reducing salaried employment globally by 10,000 people by the end of the year. The company didn't specify figures for Canada, saying only that cuts will vary "depending on staffing levels, market conditions and reductions already planned and announced."

GM also announced temporary pay reductions.

Chrysler and GM have until Feb. 17 to present their global restructuring plans to the U.S. government and until Feb. 20 to hand their plans over to Canadian officials.