The governments of Canada and province of Ontario agreed on Friday to provide aid worth $US2.8 billion aid to the auto sector, dependant on events south of the border.
Federal industry minister Tony Clement said the package is conditional on the United States government providing a rescue package for General Motors, Ford and Chrysler in Detroit. Ontario is their base for production in Canada.
However, the US Senate has rejected a $US14 billion proposal for the struggling car makers.
On Friday, the White House said it might dip into a $US700 billion US bank recovery fund to stave off an industry collapse.