TORONTO — Travellers who take the Greyhound bus in Ontario will face service reductions in the new year, the company said Wednesday.

Greyhound Canada said it will scale back some of its passenger bus services in the province in response to financial losses.

The announcement came the same day that a company-set deadline to reach a funding deal with the provincial government expired, with the government saying it has no plans to give the bus company a subsidy.

"Greyhound Canada has indicated for months that it could no longer sustain current financial losses without making adjustments to our existing operations," senior vice-president Stuart Kendrick said in a statement.

"The route frequency reductions we are announcing today are designed to relieve some of that financial pressure."

In all six routes will be reduced or cut as of Jan. 17, Greyhound said.

Service on the Trans-Canada Highway between Winnipeg and Thunder Bay will be maintained at two trips a day.

However the run on the Trans-Canada Highway between Thunder Bay and Sault Ste. Marie will be reduced from two trips to one trip daily each way, except in the summer when there will be two trips.

The route between Sudbury and Sault Ste. Marie will be cut from three trips to two trips daily each way. One trip daily each way is also being shaved from the Toronto to Niagara Falls route and the Kitchener to London run.

Sunday and weekday services are being eliminated on some routes.

"We were pleased to receive a letter (on Wednesday) from Greyhound advising that they decided to continue providing service between Sault Ste. Marie and the Manitoba border," Nicole Lippa-Gasparro, a spokeswoman for Transportation Minister Jim Bradley, said in an email.

"We recognize the serious nature of this situation and understand how important bus transportation is for the people of Ontario," she said.

Greyhound has met with the Ontario government on several occasions, and these discussions have been very constructive, she added. But there are no plans for a future meeting.

Lippa-Gasparro said the government was pleased it was able to work with the bus company in order to continue service for Greyhound users in Ontario, but the province would not be following Manitoba's lead.

"Given the Ontario government's $24.7-billion deficit due to fighting the global recession, we are not considering subsidizing a private bus line," she said.

In October, Greyhound backed off its threat to pull its buses out of Manitoba after the government promised to provide a subsidy that it said was less than the $4 million a year that Greyhound said it is losing in the province.

The company had issued an ultimatum in September to the federal and provincial governments, saying it would shut down bus routes in Manitoba and northern Ontario if it didn't receive $15 million a year in subsidies nationally -- half of what it was losing on the non-profitable routes.

It also wants federal regulations that require it to operate money-losing routes to be loosened.

The company said even with the service reductions announced Wednesday it's still facing losses in Ontario.

Greyhound, the only transit option in many remote areas, has said rural depopulation and a faltering economy have hurt its bottom line. It estimates its losses some $30 million a year on interprovincial routes.

The long-term future of Greyhound's cross-country operations hangs on the outcome of the federal-provincial-territorial working group that is due to recommend regulatory and policy changes in September 2010, said Kendrick.

The company has also said it's reviewing its operations in Alberta, Saskatchewan, British Columbia, Yukon, and the Northwest Territories.