EDITOR'S NOTE: This op-ed was written by Vic Fedeli, the Ontario minister of economic development, job creation and trade. It appeared in the December 2020 print edition of Automotive News Canada.
It was a banner round of contract talks between Unifor and the Detroit Three automakers in 2020. Over several months, we saw the automakers pledge nearly $5 billion in investments, with upgrades and new technologies for facilities across the province. These investments will be critical to the longterm sustainability of the sector and will help bolster the auto parts supply chain, meaning a positive outlook for the workers and their families who rely on the good jobs the industry provides.
There was one significant announcement after another. Ford Motor Co. is investing over $2 billion to transform its Oakville Assembly Complex into a global hub for battery-electric-vehicle production. Fiat Chrysler is planning a major retooling of its Windsor Assembly Plant for more electric vehicles. General Motors is bringing pickup production back to the Oshawa Assembly Plant — welcome news for the workers of a plant that had announced almost two years ago it would be closing its doors.
While our auto sector has a history of excellence, over the last decade we have lagged in attracting auto investment to Ontario. Since 2000, Ontario’s share of North American auto assembly has shrunk to 12 per cent from 17. Since 2004, Mexico has attracted over $15 billion in greenfield auto investment while Ontario has only managed $1 billion. When it comes to the future of electric vehicle production,
Ontario had not seen a dollar of the more than $300 billion invested globally. Our auto companies, as well as Unifor, deserve congratulations for this turnaround, reversing a decades-long flow of investment to other jurisdictions.
Of course, this didn’t happen by accident. Over the last couple of years, Premier Doug Ford and our government have put in a great amount of dedicated “sweat equity” to ensure we attract these game-changing investments to Ontario. It began with meetings with the eadership from all our auto companies to discuss the implementation of NAFTA 2.0 and its potential to create new opportunities for Ontario’s auto industry. The province then launched its Ontario Automotive Modernization Program (O-AMP) at Ford’s Essex Engine Plant in Windsor in September 2019. With a lot of shoe leather, we continued to send the message that Ontario is the best jurisdiction for major auto manufacturers to make winning investments.
When GM announced it planned to close Oshawa Assembly, that was a real wake-up call. Since taking office, we have continued to lay the foundation to ensure that the sector was not only successful but highly competitive. We know that mak-ing it easier for companies to do business in Ontario is integral to attracting auto investments of this size and scope. We heard from the automakers that Ontario had become an expensive jurisdiction in which to do business. Through lowering taxes, reducing electricity costs and cutting red tape, we reduced the cost of doing business in Ontario by nearly $7 billion a year.
Building EVs in Oakville will also spur the development of a battery supply chain throughout the province. This will include opportunities for mining, as batteries require various minerals found in Ontario’s North.
In the longer term, securing the Ford investment and the EV supply chain that will grow around it will make it easier for Ontario to attract investments from other automakers.
Although we find ourselves in uncertain times, our automotive sector is back on the right track. Ontario is once again a powerhouse for global auto investment. However, we’re not going to just coast on the momentum we’ve built. We’re keeping our eye on the ball to make sure Ontario remains one of the world’s top auto hubs for generations to come.
