The Liberals haven’t acted on an auto policy in the decade since the end of the Auto Pact. The end of the Auto Pact and signing of NAFTA created challenges for the auto industry the Liberals just didn’t anticipate or understand. Similarly, Kyoto presents new opportunities and challenges but with the right policies we can become a world leader in auto manufacturing and innovation. It is long past time that we have a plan to deal with this important manufacturing industry in the context of these new challenges and opportunities.
This past winter, after leaked comments from a Liberal caucus meeting and continued pressure in the House of Commons, the newly minted finance minister, Ralph Goodale, made promises in the budget for an auto policy. No details have yet to be released, and the Liberal platform from the recent election provides no further clue as to the role this government sees itself playing in the auto industry. Former MP Susan Whelan indicated during the campaign that the Liberal Party would have details of their plans for an auto policy before the end of this summer but as usual with Liberal promises, we are still waiting.
A strong leadership role is required of the federal government if we are going to increase our record of getting only one out of 18 new assembly plants built or announced in North America since 1990. The auto industry is our most important manufacturing sector and our biggest export earner but we have fallen to eighth place as a world leader in auto manufacturing. Auto manufacturing supports 150,000 direct jobs and for every auto job, there are seven spin-off jobs. You cannot implement policies that affect the auto industry, without affecting the economy of our nation.
But that is exactly what has happened. The federal government implemented a globalization policy, entering into the FTA and then NAFTA and allowing the World Trade Organization to strip away the Auto Pact. This of course had huge implications for the auto industry and auto communities. The federal government promised that establishing “a level playing field” under the free trade regime would offset the loss of the Auto Pact, a trade agreement that fostered the development of the Canadian auto industry. They argued that Canadian social policy, like our health care and our low dollar policy would put industry in general and the auto industry specifically in a favourable competitive position and the industry would flourish.
They were wrong. In the last decade not one new auto assembly plant has been built in Canada, while 10 have been built in the United States.
We have seen lost opportunity after lost opportunity in Canada head south to the U.S. or Mexico. These plants are being lured south by governments offering massive financial incentives to manufacturers. Despite a decade of proof, our government continues to insist that our health care system and low dollar are incentive enough to attract new auto investment. This while they have implemented the most massive cuts to our health care system in history!
It should be clear to the government the playing field is not level. The trade deals they signed, which allow huge subsidies and their refusal to come to the table, have put the Canadian auto sector at a huge disadvantage. It has actually been the CAW [Canadian Auto Workers union] that has taken a leadership role, negotiating for new plants at contract time, only to watch the federal Liberals fumble opportunities by arrogance and neglect. We witnessed this in Windsor and Oakville may suffer a similar fate.
The signing of the Kyoto Protocol on climate change will create challenges, but also opportunities for the industry. In the summer of 2003, the NDP released their “Green Car Strategy,” an action plan created in consultation with the CAW and Greenpeace that gives Canadians a real choice to drive green and makes Canada a world leader in promoting air quality and job creation. Implementation of Kyoto will demand the development of more fuel-efficient vehicles. Contrary to what many business leaders say, this will mean more jobs not fewer, if we act now to take advantage of this opportunity and establish Canada as a world leader in the development of new environmentally responsible technologies.
There is no doubt that “Green Cars” are the way of the future. In June, the state of California released an ambitious plan to reduce green house gas emissions. California is considered a trend-setter in air pollution legislation, and Canada’s former minister of environment, David Anderson, indicated that he was willing to emulate the new California laws if carmakers didn’t start following the current system of voluntary emissions reductions.
Carmakers have pointed out that large changes like those proposed by California don’t just affect the engine and transmission, but go to the heart of the design of every vehicle and the materials used, saying, “It could eventually touch essentially everything about the design of a motor vehicle.” It is time that Canada gets in on the groundbreaking comprehensive approach to green technologies that will be the way of the future to continue to ensure that Canada play a leading role in the auto industry.”
During the recent election, the Liberals promised that they would give financial assistance to Ford’s Oakville upgrade plan and GM’s renovation in Oshawa.
This could be a promising start, although to date, no actual details have been released. It is time for the talk to stop and for a detailed action plan to be developed. We need to ensure that we lead in R&D, particularly in new “green” technologies, are able to attract interesting new investment opportunities and not only maintain the jobs that exist but increase the number of manufacturing jobs.
With a positive national strategy we can encourage consumers to purchase a new wave of greener vehicles but we have to ensure that they are manufactured and assembled in Canada. With this type of comprehensive strategy we can begin to reclaim our spot among the world leaders in the automotive industry.
NDP MP Brian Masse is his party’s industry critic and represents the riding of Windsor West, Ont.
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