Participating in the overall restructuring of GM and Chrysler was necessary to protect the Canadian automotive sector at large, which I said in my opening remarks.
With most of the production exported to the U.S., the events that were south of the border were affecting Canadian car production and auto part suppliers. Just to put numbers in perspective, the GM production, months before the worst part of the crisis, was 150,000 units, which they were producing on an annual basis. That went down to 49,000, just to give you a sense of just how much that dropped. In terms of Chrysler, production fell from 143,000 to 30,000. You have drops of about two-thirds in the case of GM and a drop of about 80% in the sense of Chrysler.
Obviously at the end of the day having such a steep decline in terms of production really put the viability of those operations at risk. As these companies were looking to restructure, the Government of Canada and the Government of Ontario wanted to ensure that we were at the table so that any restructured company would essentially maintain the Canadian operations.
We protected those interests in terms of our negotiations with those companies. While I can't get into the details of the covenants because they are commercially confidential, there were production commitments made by the companies and there were commitments made in terms of the capital expenditure investments in Canada as well as research and development commitments to Canada.
The last thing I will just say, which is important to note as well, is that the viability of these companies not only mattered to those companies and the suppliers obviously that relied on them, but also to the other manufacturers that did not directly receive money.
I will give you just two very quick quotes. During the crisis Toyota essentially said that they were mostly concerned with the suppliers, “And if the supply chain falls apart...it could stop production at Toyota's plants, too.”
As well, Alan Mulally the CEO of Ford, said in 2012, “If GM and Chrysler would've gone into free-fall they could've taken the entire supply base into free-fall also”.