CAW President Urges Canadian Government to Keep Share of GM
November 18, 2010, 9:40 AM EST
While calling the General Motors IPO "a good-news story" for the company and the whole auto industry, CAW President Ken Lewenza is cautioning against the quick sell-off of the company's shares by the federal and Ontario governments.
"This is an important demonstration that GM is continuing to regain its stability both in Canada and the United States," said Lewenza. "But government should not be in any rush to sell off its shares."
Lewenza said that maintaining shares in General Motors could be financially lucrative for the government over the long term as the company continues its comeback and its share price rises.
"The best choice for taxpayers and Canadian workers would be for government to retain a significant portion of its shares, to help ensure that the company maintains its Canadian manufacturing footprint and preserves Canadian jobs.
Lewenza said General Motors' turnaround further proves the importance of government intervention when key industries, like the auto industry, falter due to free-market problems such as the credit freeze and the financial crisis of 2008-2009.
"Without crucial government support, we would have lost more than 9,000 jobs at GM and tens of thousands more auto parts and spin-off jobs. Government did the right thing in stepping in to preserve these jobs, especially as hundreds of thousands of Canadians were being thrown out of work during the recession. Government assistance averted what could have been a disaster in several regions of the country, and helped preserve the government's own tax base. In the end this will be a good deal for workers, for the economy, and for taxpayers."