A General Motors sign is seen through a fence at an auto plant, it's the vast number of stored vehicles. (AP / LM Otero) Ministers to meet on auto bailout amid GM warning Updated: Thu Mar. 05 2009 10:23:34 AM

CTV.ca News Staff

Finance Minister Jim Flaherty and Industry Minister Tony Clement are meeting with U.S. officials in Washington Tuesday to work on co-ordinating plans for helping the struggling auto sector.

The visit comes as General Motors announced Thursday that auditors have expressed "substantial doubt" about the ability of the automaker to keep operating.

In its annual report, GM said auditors cited "the corporation’s recurring losses from operations, stockholders’ deficit, and inability to generate sufficient cash flow to meet its obligations and sustain its operations" as the main reasons for their stance.

GM also said that if it can’t successfully execute its complex restructuring plan then the company could "potentially be forced to seek relief through a filing under the U.S. Bankruptcy Code."

GM wants to avoid bankruptcy protection because it would scare off customers who would be fearful that their warranties might not be honoured in the future.

In total, GM is seeking US$30 billion from the U.S. government and billions more from Ottawa and Ontario.

Ottawa has said it would provide up to $4 billion in emergency loans, with GM Canada eligible for up to $3 billion, and Chrysler Canada up to $1 billion.

Chrysler announced Wednesday it plans to eliminate the third shift at its minivan assembly plant in Windsor, Ont., which means about 1,200 jobs will be cut.

In an effort to co-ordinate plans, Flaherty and Clement are meeting with White House aide Larry Summers to discuss the situation facing automakers.

Flaherty is also scheduled to meet separately with U.S. Treasury Secretary Timothy Geithner.

Clement told reporters Wednesday that the government was still reviewing plans submitted by GM and Chrysler.

"I intend to discuss those with Larry Summers," Clement said, according to Reuters.

"We’ll be discussing issues including the auto sector and making sure that we understand where they’re coming from and they understand where we’re coming from."

Meanwhile, Ken Lewenza, national president of the Canadian Auto Workers, has scheduled a news conference for Thursday morning to update the public on upcoming negotiations between the union and GM, Chrysler and Ford.