DETROIT -- Chrysler Group's decision last week to withdraw its request for almost $640 million (U.S. ) in government assistance from Canada and pay for renovations itself means minivan production will stay in Windsor, Ontario, for now.
Reid Bigland, the company's head of Canadian operations, said Chrysler's announcement to proceed in a renovation of Windsor Assembly without assistance was "good news" for Canada.
Chrysler said it remains committed to building the replacements for the Chrysler Town & Country and Dodge Grand Caravan in Windsor and the next-generation Dodge Charger and Challenger and Chrysler 300 in Brampton, Ontario.
Those vehicles accounted for 20 percent of the 1.8 million vehicles that the automaker sold in the United States last year.
Chrysler's request for funding had become the subject of intense political debate in Ontario, where a parliamentary election is expected to be called this year.
The leader of the province's Progressive Conservative party, Tim Hudak, had called Chrysler's request a "nine-figure ransom" and "corporate welfare."
Chrysler said its request had become "a political football" that would not benefit the company in the long run.
The automaker said it would go ahead with its plans in Canada but would monitor its costs of operating there, citing its next labor negotiations in 2016 as a factor.
Bigland, who along with Chrysler Group CEO Sergio Marchionne is a Canadian, said the political debate being waged in Canada was inaccurate.
"If you think the notion of free-market capitalism exists in the automotive world today, you're mistaken. In every jurisdiction around the world, there is an issue of assistance" with such large projects, Bigland told Automotive News.
Federal, state and municipal loans and tax abatements, tariffs, trade policies, currency fluctuations, infrastructure, labor, taxes and energy costs all factor into decisions on where to build manufacturing plants, he said.
"It's just the reality of the global automotive business," Bigland said. "It's important for all companies to be globally competitive. But it's also important for jurisdictions to be globally competitive."