‘Good news for Canadian workers’

Auto sector, politicians sigh in relief after U.S. tweaks bill

This article was written by Rob Ferguson and was published in the Toronto Star on July 29, 2022.

Canada’s auto sector is breathing easier after a U.S. deal to scrap “buy American” provisions in an electric vehicle tax-credit plan and widen them to all vehicles made in North America.

The federal and Ontario governments had been fighting the protectionist push from U.S. President Joe Biden’s administration for more than a year, warning it threatened the existence of domestic auto manufacturers and suppliers in Canada, put tens of thousands of jobs at risk and would hurt U.S.-based parts makers as well.

“The new language is exactly what we have been lobbying very hard for,” Automotive Parts Manufacturers’ Association president Flavio Volpe said Thursday after news of the breakthrough in Washington.

“If the exact same car costs less because it’s made in the U.S., no one would be making them at Canadian plants,” he added in reference to proposed subsidies of up to $12,500 (U.S.) per electric vehicle for American consumers.

The dramatic change came Wednesday night when Senate majority leader Chuck Schumer of New York and Sen. Joe Manchin of West Virginia — both Democrats — agreed to propose an amendment to Biden’s climate and health bill expanding the tax credits to North American electric-vehicle production.

Manchin had been holding out on the change, which will probably face stiff opposition from Republicans.

The GOP will be wary of giving Democrats a legislative win with midterm elections this fall.

Nevertheless, it is “good news for Canadian workers, jobs and our manufacturing industry,” federal Trade Minister Mary Ng said in a statement.

“Since the prime minister’s first meeting with President Biden last year, we have been relentless in underscoring that the original proposal would be harmful to both Canada and the U.S., so we’re glad to see that recognized in the new version of the bill.”

Ontario Premier Doug Ford, who also sounded the alarm on the original proposal and travelled to Washington himself to lobby U.S. politicians, took to Twitter to hail the deal.

“Thank you to everyone who joined in the push,” he wrote.

“Let’s keep building a North American partnership that works for everyone.”

“There was a lot at stake,” said Ontario Economic Development Minister Vic Fedeli.

“This is the next step towards closure … it gives us a clear signal to go after even more auto parts business.”

While he also hailed the deal as “good to see,” president Brian Kingston of the Canadian Vehicle Manufacturers’ Association — which represents General Motors, Ford and Chrysler’s parent company Stellantis — said the U.S. subsidies for EV buyers are substantially higher than the $5,000 offered in the Trudeau government’s last budget.

“We have to match,” he added, noting the Detroit Three are investing billions in electric-vehicle production in Canada, including a $5-billion electric-vehicle battery plant by Stellantis and LG in Windsor, which will be supplied with critical minerals from northern Ontario mines.

“We can play a huge role in this battery supply chain.”

This is the next step towards closure … it gives us a clear signal to go after even more auto parts business.


Author: Ray Nakano

Ray is a retired, third generation Japanese Canadian born and raised in Hamilton, Ontario along with his 4 younger sisters. He resides in Toronto where he worked for the Ontario Government for 28 years. Ray currently practises in 2 Buddhist traditions: Jodo Shinshu and that of Thich Nhat Hanh. Ray is passionate about climate action and very concerned about our Climate Crisis. He has been actively involved in the ClimateFast group (https://climatefast.ca) for the past 3 years. He works to bring awareness of our Climate Crisis to others. He has created the myclimatechange.home.blog website, for tracking climate-related news articles, reports, and organizations. He is always looking for opportunities through the work of ClimateFast to reach out to communities, politicians, and governments to communicate about our Climate Crisis. He is married and has 2 daughters and 2 grandchildren. He says: “Our world is in dire straits. Doing nothing is not an option. We must do everything we can to create a liveable future for our children, our grandchildren, and all future generations.”

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