Greyhound Canada said on Thursday that it plans to halt bus service in Manitoba and Northwestern Ontario, and further shutdowns could be on the way.
The company said it's also "reviewing its operations in Alberta, Saskatchewan, British Columbia, Yukon, and the Northwest Territories."
The inter-city bus operator said service could stop in 30 days in Manitoba and 90 days in Northwestern Ontario.
Greyhound said its routes between major cities are profitable for the most part, but the company and other bus operators are forced by regulations to effectively subsidize service to small-town Canada, including shipping parcels.
Greyhound is asking the federal and provincial governments to step in and find a solution to avert the planned closings, requesting help to cover its losses in order to maintain service to rural Canada.
"The decision to cease our operations in Northwestern Ontario and Manitoba was a very difficult one. We have repeatedly asked the federal and provincial governments to change the existing legislative and regulatory regimes that govern inter-city bus operations," Greyhound senior vice-president Stuart Kendrick said in a statement.
"Our financial situation is dire and we are no longer in a position to absorb losses that are almost solely attributable to government policies."
But Transport Minister John Baird said he was surprised to read Mr. Kendrick's comments, adding Ottawa is concerned about Greyhound's plans to discontinue some services.
"I think their actions are heavy handed. It's an attempt to bully the provinces of Manitoba and Ontario," Mr. Baird said in an interview, arguing that the issue is under provincial and not federal jurisdiction.
He said he has met with Greyhound, and rejected the company's request for financial aid.
"This is a shakedown. They're asking for a subsidy," Mr. Baird said.
Greyhound Canada and Dallas-based Greyhound Lines Inc. are owned by Scottish-based FirstGroup PLC.