Automotive News Canada - February 2022 - 10

10
02.22
OPINION
Invest in suppliers
to make the EV switch
Governments
open their
wallets to
support EV
THE ADVERSITIES JUST KEEP PILING
up for Canada's parts makers.
COVID-19, border closures,
increased costs, the ongoing semiconductor
shortage, protectionist
U.S. trade policy, stuttering automobile
production and, as you're no
doubt aware by reading this issue, a
recent blockade of the Ambassador
Bridge joining
Windsor, Ont., and
Detroit.
And then
there's the bad
stuff.
plants, and that
should include
helping the
supply chain
transform.
A story on Page
17 details what is
likely to be the
ultimate challenge
for many suppliers
in this country:
electric vehicles.
New, exciting and
financially daring
for automakers, and also lethal for
some parts builders. Not just for
those whose component expertise
will not be needed to build EVs, but
for those short on capital to invest in
building different components, presuming
they wanted to and could get
the contracts.
" This is a substantial change for
[automakers], " said Michael Robinet,
executive director of automotive advisory
services at data company IHS
Markit. " It is a monumental change
for some suppliers. "
Even some executives at supply
giant Magna International - which
has incredible resources, massive
income and experience with electric
powertrains - are " nervous " about
the transformation to EVs. So what
chance do mere mortals have?
The story, by Toronto Bureau Chief
David Kennedy, cites a report that
nearly 60 per cent of Canada's 950
auto-parts plants will be affected by
the shift to EVs, and 64 powertrain
and transmission parts plants are at
high risk because they build components
needed only for internal-combustion
vehicles. Tens of thousands
of jobs are on the line, according to
the report.
Even if all current suppliers made
the transition, there are far fewer
components in electric vehicles.
There are no mufflers, catalytic converters,
engine blocks, pistons, belts,
water pumps, fuel tanks and transEDITOR-IN-CHIEF
JEFF
MELNYCHUK
missions.
The infographic on Page 16
shows many of the major differences
in powertrain components between
internal-combustion vehicles and
EVs. And that's the big stuff. There
are also no belts, pulleys, speedometer
cables, and nary a moulded plastic
panel to house a gauge cluster.
Plants that build EVs will also likely
turn out fewer vehicles - at least
in the near term - and the suppliers
that support them will provide proportionately
fewer parts.
We're in an overlap period now as
automakers are continuing to build
internal-combustion vehicles while
also investing huge sums of money in
EVs. For example, Ford isn't cancelling
the F-150 pickup to build the
electric F-150 Lightning. The company
is building both and will continue
to do so for years to come. Same for
the internal-combustion Chevrolet
Silverado and its new electric cousin.
That's likely a bonus for suppliers
for now, but with so much money
being poured into EV development,
there is less allocated to internal
combustion. That means when it's
the end of the line for some plants,
they will close for good. And also the
plants that support those plants.
The suppliers that carve out an
electric future won't be free and
clear, though. They'll still be subject
to the pressures of rising prices,
semiconductor shortages, trade conflicts,
future pandemics and bridge
blockades.
To make the switch, they'll need
financial support from the government
just as much as any automaker
setting up a new plant to build EVs in
Canada. Don't forget how many hundreds
of millions of dollars the federal
and Ontario governments are providing
Ford, General Motors and
Stellantis for their electrification
efforts. Then consider the accepted
formula that for one auto-plant job
there are roughly seven supplier jobs.
That's not just worth investing in, it's
necessary for the industry. - ANC
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Why welcome immigrants?
Two words: Frank Hasenfratz
FRANK HASENFRATZ CAME TO CANADA AS A
Hungarian refugee who was penniless, but rich in
hope and ambition.
" When my father arrived in this country, he was
given $5 by an immigration official, as was the practice, "
said Linda Hasenfratz, who delivered a moving
eulogy Jan. 15 at the funeral of the
founder of Linamar Corp.
" That was the only money in
his pocket. "
Today, the Guelph, Ont.-based
global supplier employs 26,000
people, including more than
11,000 in Canada, Hasenfratz
said in the tribute to her father,
who died Jan. 8 at age 86.
Newcomers
such as Frank
Hasenfratz built
a better life in
Canada. And
built a better
country.
Linamar employs " many new immigrants " and
contributes about $400 million in taxes annually to
the Canadian economy, she
said.
" That's not a bad return on
the investment " Canada made
by welcoming Frank Hasenfratz
back in 1957.
And it's a story she tells
" every time I hear someone
complaining about refugees and
immigration. "
Frank Hasenfratz was among
the postwar wave of newcomers
who fled their troubled homelands
to build a better life in Canada. Along the way,
they built Canada into a better country.
They are testament to the ongoing need for
immigrants to bolster Canada's population, drive
MACALUSO
MANAGING EDITOR
GRACE
economic growth, enrich society and ease skilled-labour
shortages that are currently challenging several
sectors, including automotive.
The shortage is so dire that Linamar, for example,
posted a sign last fall in front of a Guelph plant,
advertising for employees and offering $1,500 signing
bonuses, according to CBC News.
Governments have been responsive.
After COVID-19 forced the closure
of international borders for
much of 2020, the federal government
in 2021 granted permanent
status to 401,000 newcomers. It's
part of the Liberals' plan to boost
immigration targets
over the next three years.
For Canada's auto sector,
that comes at a critical time as
the global industry shifts
toward electrification. It will
need all the skills, drive and
innovation our newcomers
have to offer.
At a Nov. 17 press conference
to unveil Ontario's plan to
ramp up electric-vehicle production,
Premier Doug Ford
touted the need for immigrants
to fill job vacancies in the auto
sector.
" I'm hearing it absolutely
everywhere I go in the provFrank
Hasenfratz
came to Canada
in 1957. He
left a legacy in
Linamar.
FILE PHOTO
ince, no matter small, medium or large companies, "
Ford said. " We need people. "
More people such as Frank Hasenfratz. - ANC
Ambassadors of bridge movement
BY ABOUT 11 A.M. EST ON
Saturday, Feb. 12, police were
roughly two hours into their plan
to disperse a group of defiant
anti-vaccine mandate, Prime
Minister Justin Trudeau-hating
protesters blocking access to the
Ambassador Bridge, one of North
America's most critical arteries of
trade.
That's also the time I began
live-tweeting what I was seeing
on a seemingly infinite number
of livestreams posted on
Facebook, Twitter, YouTube and
TikTok.
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GRACE MACALUSO, MANAGING EDITOR, 226.787.0441, Grace.Macaluso@autonews.com
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The police
approach
was aimed at
preventing
violence and
injuries during
the blockade.
I was
enthralled with
police officers'
slow, calculated
movement.
They moved
with impressive
precision. I was
tweeting rudimentary
maps
of the location
to my followers
who didn't hail from Windsor,
Ont., and were unfamiliar with
the lay of the land.
About 90 minutes into my
viewing and tweeting marathon, I
answered a call from one of my
sources in the auto industry.
They wanted to know what was
taking police so damn long to
round up and arrest the hundreds
of protesters and end the
blockade, which, according to
the Automotive Parts
Manufacturers' Association
(APMA), cost the industry $1 billion.
DIGITAL
AND
MOBILE EDITOR
GREG
LAYSON
Just an hour before that call, I
had tweeted the following in
response to a video showing
police inching their way to move
protesters:
" Remember, surgery is not a
sprint, you guys. We might be
here a while. "
And we were. I was still
watching livestreams Sunday at
1 a.m., 16 hours later.
Sunday morning, 28 full
hours after the police began to
act, the Windsor Police Service
tweeted:
" Police used discretion during
... the demonstration to avoid
creating an unstable situation
and potentially putting the public
at risk. This exercising of police
discretion should not be confused
with lack of enforcement. "
I responded with this:
" This is key. I know plenty of
people - even some in the auto
industry - wanted this to end as
swiftly as possible. But this was
open-heart surgery on a major
artery of trade. Surgery sometimes
takes a while. But soon,
the heart will beat again. "
And it did. Nearly a week
after the forced closure of the
bridge, it reopened late Sunday
night.
By Monday, Feb. 14 -
Valentine's Day no less - the
heart was beating again. For getting
a court injunction to end the
blockade, we have to thank
Windsor Mayor Drew Dilkens for
teaming up with Flavio Volpe of
the APMA, Brian Kingston of the
Canadian Vehicle Manufacturers'
Association and Rakesh Naidu of
the Windsor-Essex Regional
Chamber of Commerce. And of
course we have to thank law
enforcement.
On Monday, as the industry's
lifeblood flowed across the
bridge, I photographed an auto
hauler filled with Windsor-made
minivans rumbling up the span's
incline, bound for the United
States.
Getting trucks moving again
was open-heart surgery
on a major artery of trade.
PHOTO: GREG LAYSON
I snapped pictures of trucks
hauling parts built by local suppliers,
such as Anchor Daly and
Cavalier Tool & Manufacturing,
beneath the span's entrance
sign en route to customers on
the other side of the Detroit
River.
Never had such mundane
photos looked so damn good.
- ANC

Automotive News Canada - February 2022

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