Canadian auto industry executives are supporting the commitment by Canada and the United States to work together on vehicle-emission rules and electric-vehicle battery production to combat climate change.
“The two governments were out of sync [under former President Donald Trump] with respect to their climate change objectives and what they wanted to see,” said David Adams, CEO of the Global Automakers of Canada, which lobbies for import automakers. “I think having a partner that’s of the same mindset will actually advance Canada’s interests” in EV battery production.
In February, Prime Minister Justin Trudeau and U.S. President Joe Biden agreed to “take aligned and accelerated policy actions, including efforts to achieve a zero-emissions-vehicle future,” according to the White House’s “Roadmap for a Renewed U.S.-Canada Partnership.”
The integrated nature of the Canadian and U.S. auto industries makes “any sort of disharmonization amongst the way that we regulate emissions or address zero-emissions vehicles ... very challenging for the Canadian industry,” said Brian Kingston, CEO of the Canadian Vehicle Manufacturers’ Association (CVMA), a champion for the Detroit Three automakers in this country.
The two leaders also agreed to “work together to build the necessary supply chains” to make the countries “global leaders in all aspects of battery development and production.”
In recent months, Trudeau and Ontario Premier Doug Ford have spoken of their desire to build an EV supply chain in Canada, from mining materials needed for batteries through assembling vehicles. During negotiations with Unifor in late 2020 and early 2021, the Detroit Three committed to build battery-electric vehicles in Canada this decade.
The development of a battery supply chain is a complicated proposition, but it appears officials on both sides of the border want to make it happen. Reuters news agency reported in March that the U.S. government was working to help U.S. miners and battery makers expand into Canada, part of a strategy to boost regional production of minerals used to make EVs and counter China-based competitors.
Biden, during a congressional address Wednesday night said there is “no reason why American workers can’t lead the world in the production of electric vehicles and batteries.”
“We have to develop and dominate the products and technologies of the future: advanced batteries, biotechnology, computer chips, and clean energy,” he said.
The United States is also trying to boost domestic production of EV metals, which the Biden administration has said is critical. But Washington is increasingly viewing Canada as a kind of “51st state” for mineral supply purposes and plans to deepen financial and logistical partnerships with the country’s mining sector over time, a U.S. government source told Reuters.
“We have an opportunity here,” said the CVMA’s Kingston. “We’re sitting on vast critical-minerals reserves. I think Canada is well-positioned to be that supplier” to North America.
Kingston said it would also be crucial for vehicles produced in Canada to be exempt from any buy-American provisions the Biden administration develops for the U.S. government’s vehicle fleet. In January, Biden vowed to replace his government’s roughly 650,000 vehicles with electric models made in the United States.
“We do not want to find ourselves on the outside of any buy-America provision,” Kingston said. “That’s something that will be extremely important in the electric-vehicle space as we become a manufacturing hub for this new vehicle technology. We have to make sure that we are a part of any U.S. purchasing decision and we don’t end up on the wrong side of Buy America policy.”
Reuters contributed this report.