Automotive News Canada - January 2024 - 23

* JANUARY 2024
23
2024 OUTLOOK
T
By KELLY TAYLOR
WINNIPEG CORRESPONDENT
be on our toes, about the election, about
the reopening of the North American
trade agreement ... all three countries in
North America could definitely make a
difference. "
T
T
Kingston:
The federal
ZEV mandate
is
unachievable.
FILE PHOTO
he 2024 wish lists for key
stakeholders in Canada's
he 2024 wish lists for key
automotive industry are all
ing actual progress - not
the country's vehicular fleet.
There are different strategies, but the
goals are the same: jobs, investments and
closing the gaps in price and capabilities
between internal combustion and electric
vehicles.
" We now have a federal ZEV mandate,
which, as designed, is unachievable, "
said Brian Kingston, president of
the Canadian Vehicle Manufacturers
Association, which represents the Detroit
Three automakers in Canada. Kingston
said progress on installing public and
multifamily residential charging options
is " slow " and he also
wants to see the federal
government leading by
example.
" We're going to have
to see activity and leadership
on those targets.
And can we talk about
greening the federal
government, please?
The targets well exceed
what the feds have
been able to achieve.
" It's keen to put forward
a sales mandate
but is unable to electrify
its own fleet. "
A spokesperson for
the Treasury Board Secretariat, which
manages the 40,000-vehicle federal fleet,
said the government's goal is to be 100
per cent zero-emission vehicles by 2030.
" While progress was slower during the
pandemic due to supply chain issues...
the pace of fleet greening has accelerated
significantly over the past two years. "
A spokesperson for Environment and
Climate Change Canada said Ottawa is
investing $1.2 billion to install 84,500 public
chargers by 2029, and said its iZEV
rebate program has helped 300,000 drivers
switch to zero-emission vehicles.
David Adams, president of the Global
Automakers of Canada, which represents
foreign auto brands in Canada, said early
adopters - " those prepared to pay any
price, tolerate any inconvenience " -
have already bought EVs, and the challenge
is to stoke demand among the
remaining drivers.
EV SWITCH FOR PARTS MAKERS TOUGH
Lana Payne, national president of
Unifor, the union representing about
20,000 Detroit Three autoworkers in
Canada as well as workers at parts suppliers,
is concerned that failing to get
a quick start could cost the country a
chance to be a major player in the EV
industry.
There is progress, however, with the
Stellantis-LG Energy battery plant in
stakeholders in Canada's
topped by one objective: seerhetoric
- toward greening
automotive industry are all
topped by one objective: seerhetoric
- toward greening
SUPPLY DISRUPTIONS, AUTO THEFT
Kingston said industry and governments
should be preparing better for supply
disruptions, whether due to labour
disputes, such as the west coast dockyards
strike in 2023, trade disputes or
protests, such as the blockade in 2022 that
closed the Ambassador
Bridge connecting
Windsor to Detroit.
" We have to have
a better approach to
managing these disruptions
... we need a
more thoughtful and
proactive approach, "
Kingston said.
Issues ranging from Ottawa's
ZEV mandate, rampant auto theft,
an uncertain economy and
trade tensions with the United States
face Canada's auto industry
Windsor, Ont., set to open this year, as
well as work beginning on a Volkswagen
battery plant near St. Thomas, Ont.,
south of London.
Flavio Volpe, president of the
Automotive Parts
Manufacturers'
Association, is concerned
for Canadian
suppliers. The transition
to making parts
for EVs will be difficult
for suppliers, he said,
which run on thin
margins and are often
locked in on price.
" Inflation hits us differently.
It hits us on
the cost side, but we
can't respond on the
price side. "
Payne is calling for
targeted support for
investment in retooling,
help for transitioning
parts manufacturer
in Quebec as both a sign of promise and
warning against complacency.
" Let's not settle for good enough, let's
aim for more, let's position Canada to be
a true automotive powerhouse. "
TRADE PROTECTIONISM COULD HEAT UP
Payne:
Canada
needs to
be " on our
toes " when
it comes to
negotiating
trade deals
with the
United States.
FILE PHOTO
workplaces and for preferential hiring of
displaced workers in other sectors of the
automotive workforce.
Kingston looks at the battery plants
and other facilities under development
The year ahead, with both the looming
sunset clause in the U.S.-Mexico-Canada
trade Agreement (USMCA) as well as the
U.S. federal election in November, has
both Payne and Volpe eying trade.
Volpe suspects the Biden administration
will start to cool off its pro-union
rhetoric just as the potential Republican
nominee, Donald Trump, starts rattling
trade sabres like he did in his first term.
" I see [Biden] backing off because they
are likely going up against Trump, and
he says nonsensical red meat to the people
in the same states, promising a tariff
on all goods coming into the U.S., " Volpe
said.
" The electoral rubber match of 2024
probably has them talking about tariffs
all year, and not about what drives
them or who's going to do better to block
them. "
Payne said politics is " always a factor "
in the auto industry, and the time is now
to be planning for changes. " We've got to
A continuing thorn
in the industry's side,
Adams said, is auto
theft. According to
Statistics Canada, 83,416
thefts in 2021 rose to
105,673 in 2022, with
indications 2023 would
be worse (stats were
not available as of press
time). The proceeds of
those thefts often end
up financing imports of
guns, drugs and other
contraband, he said.
Many of the stolen
vehicles left the country
through the Port of
Montreal to show up
quickly on used car lots
in Africa and parts of
Europe and Asia.
" The party that has
been [missing in action]
so far is the federal government, "
Adams said.
" We really need the federal
government to get
Volpe: The
transition to
making parts
for EVs will
be difficult for
suppliers.
FILE PHOTO
Adams:
The federal
government
needs to
develop " a
comprehensive
plan "
to battle auto
thefts.
FILE PHOTO
engaged and develop a comprehensive
plan. "
INTEREST RATES, SALES, THE ECONOMY
Dealers are feeling cautiously optimistic
about 2024 sales, at least when
it comes to improving vehicle inventory
levels, said Tim Reuss, president
of the Canadian Automobile Dealers
Association. All brands are returning
to a " more normal " pre-pandemic supply
situation, he said. " But, do we have
enough people on board who remember
how to sell a car " in a more competitive
marketplace?
" On the service side, we're still very
short on technicians in Canada. "
Consumer demand remains strong,
and so far, the economy has managed
to avoid a recession, Reuss said, adding
that interest rates could start to fall.
" We're starting to receive some signals
in the financial markets that they might
start coming down in 2024. "
This will help sales and lower inventory
carrying costs for dealers.
Reuss predicts sales of 1.75 million
in 2024, up from the 1.66 million in 2023
estimated by DesRosiers Automotive
Consultants. -ANC
Automotive News Canada - January 2024

Table of Contents for the Digital Edition of Automotive News Canada - January 2024
