Tariff threat looms large in the heart of Canada’s auto industry
Mike Malott has survived massive turmoil during his nearly 20 years as an automotive worker here in the heart of the Canadian industry — but now that his livelihood is in the crosshairs of a United States president who appears hell-bent on restricting crossborder trade, he is frightened.
The 43-year-old assembly line worker and other residents of this Southwestern Ontario city have been on edge for months during strained North American Free Trade Agreement negotiations that have included intense scrutiny of auto production in Canada, the U.S. and Mexico.
But Trump’s post-G7 Twitter tirade about imposing a 25 per cent tariff on auto imports from Canada could have potentially devastating consequences for the integrated supply chain that has been built over decades and cause job losses on both sides of the border.
Some fear the penalties could drive the city’s auto plants, including the Fiat Chrysler Automotive factory where Malott has spent the majority of his career, out of Windsor and the country altogether.
“I can’t even imagine what the city would look like without Chrysler in it,’’ Malott said in an interview on Tuesday at the suburban Windsor home he shares with his wife, three children and a chocolate lab.
“This city would become a ghost town.’’
Malott is one of the roughly 6,000 people employed at the assembly plant, the largest manufacturing workplace in Canada, according to a 2017 report from the Automotive Policy Research Centre at McMaster University in Hamilton.
He worries he’d have difficulty finding an equivalent job in the city with his skill set if he were to lose his job at the assembly plant, which typically pays upwards of $30 an hour.
“If I don’t have a Chrysler job, I don’t have what I have today.’’
Windsor would be the epicentre of a tariff fallout that could impact Ontario’s entire economically important manufacturing base and reverberate across the country. Canada’s auto sector, the country’s leading exporter, delivers roughly $80 billion in economic activity annually. It employs some 500,000 Canadians through direct and indirect jobs.
The city has long been synonymous with the auto industry — during the early 20th century, Ford, General Motors and Chrysler all had operations here.
But the industry was decimated in the wake of 2008’s Great Recession, which saw both the Ontario and Federal government in 2009 step in to contribute $10.6 billion to Chrysler Canada and GM Canada to keep them afloat.
GM closed its remaining manufacturing plant in Windsor in 2010, ending its 90-year-relationship in the city. Ford still has two engine plants in Windsor, employing roughly 2,330 people between them — far from the as many as six plants the automaker had at one point.
But the city still wears its automotive credentials with pride. Posted outside of the FCA Windsor assembly plant is a sign that reads: “Made. Right. Here. Chrysler Pacifica. Windsor Proud.’’
The sector’s health, however, remains heavily reliant on the United States.
Canada exported some $63 billion worth of automobiles in 2016, 96 per cent of which was to the U.S., according to Statistics Canada and the U.S. Census Bureau. On top of that, the country exported roughly $21 billion in auto parts in 2016 — 90 per cent of which was shipped south of the border, according to the APRC.
Every Canadian auto assembly job creates nine spinoff jobs — ranging from parts suppliers to restaurants — according to the Canadian Vehicle Manufacturers’ Association.