Report urges investment in autonomous, electric cars
Expertise in tech sets up Canada to think long term
If Canada’s auto industry is to have a successful future, governments need to focus on supporting electric and autonomous vehicles, as well as fuel- efficient gas vehicles, according to a new report issued Tuesday.
The report produced by the Canadian Centre for Policy Alternatives, a progressive think tank, says auto companies might be attracted here by a skilled, educated and experienced labour force, but that is simply not enough.
“A high-skill labour strategy only works if we have cars to build,” wrote the report’s authors, Charlotte Yates and John Holmes.
And that means electric vehicles and autonomous cars, because they play to Canada’s strengths in technology and, more importantly, because they are where the market is headed.
“They’re areas where we’ve got a proven track record. And they’re higher value for the companies,” said Yates, provost and vice-president at the University of Guelph.
Report after report, however, shows that North American consumers are buying SUVs, large sedans and other relative gas guzzlers, rather than more fuelefficient models. Electric vehicles account for just 1 per cent of the market on this continent, according to an estimate from auto industry analyst Dennis Desrosiers.
In its November announcement saying there would be no more production at its massive Oshawa facility after 2019, GM said it was shifting investment towards electric and autonomous vehicle research and production.
While that claim has been met with derision by some auto industry experts, and has been called “disingenuous” by the Unifor union representing Oshawa workers, Yates says the current market share isn’t what is most important.
Investing in auto manufacturing plants worth billions of dollars means thinking more long-term, Yates said.
“You don’t build it for five or 10 years …Yes, you look at current demand, but you also look at where the market is going,” said Yates, adding demand for electric vehicles is increasing.
She also sees a strong potential future for autonomous vehicle research and production in Canada, based on the
growing artificial intelligence sector in this country.
The report calls for financial incentives for companies that produce green vehicles, and for increased tax credits and grants for small tech companies, to help develop a test market “for Canadian-made innovations.”
The report also touches on the USMCA — a.k.a. the new NAFTA — as well as the new trade agreements recently signed by Canada with countries in the Pacific region and with Europe.
Yates says it’s too early to judge the impact of the new agreements.
Of greater concern is the trade strategy being pursued by the U.S. government under Donald Trump.
“The ongoing uncertainty over the trade environment may be more important. The steel and aluminum tariffs are still there. As soon as it becomes clear there might be a slight disadvantage to the U.S., do they suddenly say ‘Hey, let’s slap on more tariffs?’ The volatility isn’t helpful,” Yates said.