Canadian auto bailout could reach $25B

OTTAWA, Dec. 17 (UPI) -- As Washington grapples with a bailout for automakers, Moody's Investors Service said Canada's share could soar from $3.4 billion to as much as $25 billion.

Officials with the government of Canada and provincial government of Ontario have said Canada will proportionately match 20 percent of the final U.S. settlement, and estimated during the weekend it would be about $3.4 billion.

Tuesday, Moody's said long-term U.S. efforts to prevent the collapse of Chrysler, Ford and General Motors would cost between $75 billion and $125 billion, the Globe and Mail reported. In the worst-case scenario, Canada's commitment would jump about seven times to $25 billion, the report said.

Ontario Finance Minister Dwight Duncan told reporters Canada and Ontario had to be involved in a bailout or face disastrous economic effects.

"I think we need to be there to protect the footprint of our industry. If we lose those jobs, if the industry leaves Ontario and … survives in the United States, that would have a devastating impact on our economy," he said.

The Moody's report said if the U.S. automakers can maintain holding 50 percent of the North American market, the cost of keeping them solvent will be about $75 billion, although if the share falls to 40 percent, the cost will soar to $125 billion.