Automotive News Canada - July 2023 - 32

32
* JULY 2023
PODCAST
ON DEMAND AND
AT YOUR FINGERTIPS
You've read about where the industry is headed.
Now listen to Greg Layson, Automotive News Canada's
digital & mobile editor, as he talks with
industry leaders driving it there.
Other battery companies are eligible for
the same deal provided to Stellantis, VW
CONTINUED FROM PAGE 1
all battery plants in Ontario,
including the $7 billion cell plant
planned for St. Thomas, Ont.,
by Volkswagen Group affiliate
PowerCo.
Porsche Cars Canada
JUNE 2
John Cappella
President and CEO
Linda Hasenfratz
CEO
Linamar
MAY 26
The pact will leave Ontario on
the hook for up to $5 billion in
incentives in Windsor and up to
$4.4 billion in St. Thomas.
" This auto pact will include
both companies, and any future
battery companies, " Fedeli said.
" It's the new deal in Ontario. "
Ontario's fiscal assistance in
countering the IRA has been a
sticking point for months.
Canadian Finance Minister
Chrystia Freeland has been
pushing for the province to pay
its " fair share " of the tax credits
since early this year. Ontario
Premier Doug Ford initially dismissed
the pleas, saying the IRA
was a federal problem
that required a federal
solution.
The prospect of losing
the Windsor plant, however,
prompted a change
of tack.
MAY 5
Todd Bourgon
Executive Director
Motor Vehicle Retailers
of Ontario
APRIL 28
Stephen Beatty
Vice-President and
Corporate Secretary
Toyota Canada
In mid-May, Stellantis
and LGES halted construction
on a portion
of the plant, saying the
federal government had
reneged on its pledge to
stay competitive with the
United States. Ottawa
then began heaping pressure
on Ontario for help
funding production incentives
that would match
the IRA. On June 1, Ford
relented, agreeing to pay
a one-third share of the
tax credits.
TOUGH TALKS
Payne:
There's more
investment
out there
and the
agreement is
" signalling
to the auto
industry and
to the world
that Canada
is more
than in the
game. "
FILE PHOTO
Fedeli said Ontario stepping
up was the " only way that the
federal government could do
this deal, " and Ford was not prepared
to see the jobs expected in
Windsor go elsewhere.
Unifor President Lana Payne
said the nearly two months
of talks were " very difficult, "
despite Stellantis, LGES
and the two levels of government
all signalling
their eagerness to work
out a deal.
" We always felt everyone
wanted to make it
happen, but that doesn't
always mean it happens. "
Unifor, which represents
hourly workers
at Stellantis plants in
Canada, has been pushing
for a coordinated governmental
approach on
the automotive file for
years.
The pact that's
Volpe: The
new federalprovincial
investment
formula
will
" put to bed "
any angst
among
global
investors
emerged from the series
of tough talks in Windsor
is " very much in line "
with what the union has
been advocating for, Payne said,
and will help draw further battery
supply chain spending into
the province.
created by
the Stellantis
standoff.
FILE PHOTO
battery producer that
puts down roots in the
United States, Ottawa's
approach to such investments
will remain targeted.
" We
need to be strategic
when picking deals
and it is case-by-case
still for us, " said Laurie
Bouchard, press secretary
for Canada's minister of
innovation, science and
industry.
MORE DEALS TO COME
With two battery cell
plants now secured,
Fedeli said the Ontario
government continues
to work on several other
prospects.
" Everybody in the
sector knows that there
is more investment out
there, and I think that
this deal with Stellantis
and the renewed commitment
around Volkswagen
are really signalling to
the auto industry and to
the world that Canada is
more than in the game. "
The new federal-provincial
investment formula
will also " put to bed "
any possible angst among
global investors created
by the weekslong
Stellantis standoff, said
Flavio Volpe, president
of the Automotive
Parts Manufacturers'
Association.
" It says that anybody
looking to invest at that
level in Ontario, they know what
they'll be getting from both levels
of government, and they'll be
doing it through one discussion. "
But while the new auto pact
provides transparency about
what investors can expect, unlike
the catch-all IRA, which makes
the tax breaks available to any
He did not directly address
whether the province could afford
the expense of landing further
battery makers.
" It's not can you afford more
[plants]. Without them, you don't
have that revenue. "
While the cost of the production
subsidies is considerable, he
said because they take the form of
tax breaks, it is a matter of " giving
up " tax revenue for the first
few years the plants are in operation,
as opposed to an expense
the government is paying on the
front end.
But while the provincial government
is still working on landing
more battery cell plants, and
expects its new pact with Ottawa
to draw further interest globally,
its focus has shifted toward cellplant
suppliers.
" Primarily, right now, it's
prospects on the [battery] components
because we've got two
major battery companies located
in Ontario that are going to need
those components, " Fedeli said.
The province has piqued the
interest of producers of cathode
and anode materials, as well as
manufacturers of battery separators,
copper foil, electrolyte and
lithium hydroxide, and now must
close out the deals, he added.
- ANC
APRIL 21
Sandor Piszar
Vice-President of Sales,
Service and Marketing
GM Canada
Nissan Canada
APRIL 14
'There's no quick fix' for Port of Vancouver
Steve Milette
President
CONTINUED FROM PREVIOUS PAGE
the industry group Canadian Manufacturers and
Exporters.
THE VOICES OF THE
INDUSTRY LIVE HERE.
Sign up and we'll
deliver weekly podcasts
right to your inbox:
canada.autonews.com/podcast
For advertising opportunities, contact
Matt Parsons at mparsons@autonews.com
or 248-756-4698.
Shortfalls in the shipping hub's underlying infrastructure,
however, are the real source of the problems,
Wynn-Williams said. He pointed to several
railway chokepoints and a lack of storage space in
land-strapped Metro Vancouver as two of the key
problems the federal government and local stakeholders
are working to address.
" There's no quick fix. If someone's expecting the
port to improve right now, that's not going to happen, "
he told Automotive News Canada.
EXPANSION MIGHT HELP
Some relief for automakers, on the other hand,
appears to be on the horizon.
The Annacis terminal is midway through an
expansion that will add vehicle capacity as import
volumes from Asia continue to grow. The project,
on track to be completed next year, will boost
capacity to 480,000 vehicles per year from 352,000,
said Alex Munro, a spokesperson for the Port of
Vancouver.
But the significantly higher capacity at the island
terminal following the expansion depends on rail
car supply, Emerson said. That means if the shortage
of rail cars isn't solved, the site won't reach its
capacity.
The seasonality of the automotive business also
creates challenges, Emerson said.
" We can use support from the OEMs to better
manage vessels flowing into Canada by providing a
balanced volume throughout the year versus shipping
extreme volumes over five to six months, " he
said.
Hyundai Canada's Romano acknowledged that
the car business is currently at " peak seasonality "
and said delays at the port should subside in the
second half of the year as volumes decline. Longer
term, however, he's concerned the delays could persist
as imports from Asia tick up over the next five
to 10 years.
" We're seeing more vehicles coming from Asian
countries like Vietnam and China, Tesla's now
shipping from China to Canada, so we're seeing lots
more trans-Pacific activity, " he said.
As volumes climb, the federal government must
ensure that Canada's port infrastructure can keep
up, he said. This could mean ongoing improvements
in Vancouver or adding terminals capable of
handling vehicles at other West Coast hubs, such as
Prince Rupert, B.C., Romano said. - ANC
- With files from Tim Dimopoulos
http://canada.autonews.com/podcast
Automotive News Canada - July 2023

Table of Contents for the Digital Edition of Automotive News Canada - July 2023
