Tag: tariffs

An unnecessary harvest of pain from EV tariffs

This editorial was written and published by the Globe & Mail on May 17, 2025.

This month marks the height of the planting season for canola on the Prairies – a leap of faith by farmers in any year. They hope for enough rain, but not so much that it floods. They hope for sun, but not so much that there is drought. They hope that come the fall, a thousand stars will have aligned.

But this year, the leap of faith is even bigger. That is because of the enormous uncertainty created by the punishingly high counter-tariffs imposed by China on Canadian canola oil and meal exports (along with other agricultural products) as retaliation for Ottawa’s earlier tariffs on imports of Chinese electric vehicles.

Canola, pork and seafood producers are collateral damage in the brewing trade war between Canada and China. Despite a supposed “anti-discrimination” investigation by China, it is crystal clear that agriculture has been chosen in order to inflict maximum economic pain on Canada.

And that pain is considerable. China is a huge buyer of canola, with $1-billion in oil and meal bought in 2024, an export market second only to the United States. (For the moment, $4-billion in seed exports are unaffected by tariffs.) All other markets are distant also-rans.

For pork producers, it’s a similar story. China, which buys $480-million of Canadian pork, is this country’s third biggest export market. Crucially, it buys pork products such as pig heads and tails that aren’t in high demand elsewhere. The industry says that without tariff relief, pork byproducts will simply be sent to rendering plants.

That’s the pain. What’s the gain? Initially, the federal Liberals were talking up the strategic merits of “friendshoring” within North America and co-operating with the United States on protecting the auto industry from Chinese EVs. In the era of Trump, those ambitions are not just dead, but laughable.

There was a bigger, unspoken reason: safeguarding the $52.5-billion in federal and provincial subsidies for the EV industry. (Parts of that funding are contingent on production levels and the continued existence of U.S. EV subsidies.)

Ottawa could protect would-be EV manufacturers from Chinese competitors, but it has not been able to shield them from the laws of economics. NorthvoltAB’s battery plant in Quebec is on hold following the bankruptcy protection filing of its parent company.

In February, Stellantis delayed the retooling of its Brampton plant. And earlier this week, Honda Canada hit the pause button on its $15-billion EV initiative in Ontario, pushing back the start by two years due to softening consumer demand.

The case for those subsidies was always weak. Claims of a quick payback of government funds from increased economic activity were ill-founded. The Parliamentary Budget Officer estimated in 2023, for instance, that it would take 15 years of full production for the subsidies to Volkswagen to pay for themselves.

Even that distant payday from the sector seems optimistic now as consumer demand ebbs.

It is an all too familiar end to the sad story of government subsidies. What starts out with fanfare and a big splash of taxpayer cash runs into the realities of the market.

So, the gains from EV tariffs, always questionable, are now evaporating. Clearly, the federal government needs to rethink its approach, both to spare Canada’s agricultural sector from further pain, and to avoid wasting taxpayer dollars.

That rethink need not be a capitulation to China. As a start, Ottawa could look to the European Union, which took a more nuanced approach to tariffs on Chinese EVs – one that did not simply copy and paste the American policy.

Lower tariffs, on the reasonable assumption that Beijing would similarly de-escalate, would cushion the impact on agricultural producers. Ottawa should make sure that it offers temporary support to offset any remaining downdraft.

De-escalation by itself is not enough. Ottawa needs to seek an agreement with China that would allow for the assembly of its electric vehicles, similar to arrangements made with Japanese automakers decades ago. Even better if those deals can be negotiated in tandem with any effort by the EU.

One thing is certain: canola, pork and other agricultural producers should not have to bear the cost of Ottawa’s misguided efforts to shield the automobile industry.

Honda delays plans for Allis­ton EV plant

Auto­maker post­pones $15B invest­ment amid slow­down in sales and tar­iff threat

New Tecumseh Mayor Richard Norcross said his office was flooded with calls from people asking about the effect Honda's decision to delay a $15billion investment in its Alliston facilities will have on their lives.

This article was written by Rob Ferguson and Ana Pereira, and was published in the Toronto Star on May 14, 2025.

Honda has stalled a $15­bil­lion elec­tric vehicle invest­ment in Ontario by two years, plunging the province’s already shaky auto­mot­ive industry into greater tar­iff anxi­ety.

Touted as a major addi­tion to Ontario’s man­u­fac­tur­ing base when it was announced in April 2024 by the Japan­ese auto­maker, Premier Doug Ford and then prime min­is­ter Justin Trudeau, the ambi­tious EV project hit road­b­locks from a slow­down in EV sales and tar­iffs imposed by U.S. Pres­id­ent Don­ald Trump.

Honda announced the post­pone­ment on Tues­day after fore­cast­ing a 59 per cent profit decline in the cur­rent fiscal year. But, it said, the delay of the massive EV sup­ply chain invest­ment will have “no impact” on pro­duc­tion of Civics and CR­Vs and some 4,200 employ­ees cur­rently work­ing at a giant man­u­fac­tur­ing facil­ity in Allis­ton, a town­ship an hour’s drive north of Toronto.

“The com­pany will con­tinue to eval­u­ate the tim­ing and project pro­gres­sion as mar­ket con­di­tions change,” Honda Canada spokes­per­son Ken Chiu said.

The pause is another hit to Ontario’s vul­ner­able auto sec­tor, already suf­fer­ing under trade war uncer­tainty. Gen­eral Motors recently reduced shifts at one of its assembly plants while Stel­lantis tem­por­ar­ily laid off work­ers.

“It’s not sur­pris­ing,” said Robert Kar­wel, dir­ector of auto­mot­ive cus­tomer suc­cess at data ana­lyt­ics firm J.D. Power, speak­ing of the Honda announce­ment.

“We don’t sell enough elec­tric cars neces­sary to jus­tify that type of invest­ment without util­iz­ing exports to United States and, frankly, exports glob­ally as well to fill those plants,” he con­tin­ued.

“It’s going to be a bit of a blow to the com­munity,” said Kar­wel, though he doesn’t think Honda is “going any­where.”

“This is a pause in spend­ing, but it’s not a roll­back.”

Honda’s invest­ment includes an elec­tric vehicle assembly plant as well as a new stand­alone bat­tery man­u­fac­tur­ing plant at Honda’s facil­it­ies in Allis­ton.

Local res­id­ents were dis­ap­poin­ted by the project delay, said Richard Nor­cross, mayor of New Tecum­seth (the muni­cip­al­ity encom­passing the town­ship of Allis­ton).

“We were just hop­ing to gain a lot more employ­ment.”

Honda is the largest employer in the region, added Nor­cross, whose office was flooded with calls from local busi­nesses and work­ers try­ing to under­stand the impact Honda’s decision will have on their lives.

Just last month, reports that Honda was mov­ing some of its pro­duc­tion to Amer­ica had rocked fear­ful loc­als. (The auto man­u­fac­turer later denied the rumours).

Uni­for, the union rep­res­ent­ing about half of all auto assembly employ­ees in Canada, said it “does not rep­res­ent work­ers at the Honda Allis­ton plant, but does rep­res­ent mem­bers in the plant’s sup­ply chain and takes any threat to Cana­dian auto jobs as a mat­ter of grave import­ance,” accord­ing to an emailed state­ment.

“Trump’s roll­back of EV policies and his pun­ish­ing tar­iffs on Cana­dian­made vehicles are killing jobs week after week and threat­en­ing the future of our industry,” Uni­for pres­id­ent Lana Payne said in the state­ment.

Premier Ford said he had talked to Honda offi­cials about the delayed project that was inten­ded to pro­duce 240,000 vehicles annu­ally and cre­ate another 1,000 jobs at Honda in Allis­ton.

There was to be an EV assembly plant and feeder factor­ies with thou­sands more spinoff jobs in parts pro­duc­tion and con­struc­tion of the new plants.

“They prom­ised us they’re going to con­tinue on with their expan­sion,” the premier said in Pick­er­ing Tues­day. “They’re going to keep that facil­ity mov­ing for­ward, so we’ll just see how that moves for­ward, but we’re very con­fid­ent that we’ll con­tinue pro­du­cing Honda vehicles here in Ontario.”

The exist­ing Honda plants in Allis­ton pro­duce about 400,000 Civics and CR­Vs a year.

The Ontario and fed­eral gov­ern­ments were to each pony up $2.5 bil­lion toward the EV project, but pro­vin­cial offi­cials said none of that money has flowed yet.

Chiu, the Honda Canada spokes­per­son, said ground pre­par­a­tions had begun at the Allis­ton site, but not actual con­struc­tion work.

The $15­bil­lion Honda EV plan dwarfed the $5­bil­lion Stel­lantis EV bat­tery plant now oper­at­ing in Wind­sor by the par­ent com­pany of Chrysler, Dodge and Jeep and the $7­bil­lion Volk­swa­gen EV bat­tery plant under con­struc­tion south of Lon­don near St. Thomas. Both plants are in line for bil­lions of dol­lars in sub­sidies and tax cred­its from the fed­eral and Ontario gov­ern­ments.

There have been other snags in the move to EVs as sales growth has been slower than expec­ted.

Just over a year ago, Ford said it would delay EV pro­duc­tion at its Oak­ville assembly plant by two years until 2027. That fact­ory was gran­ted up to $295 mil­lion in tax­payer sup­port from each of the Ontario and fed­eral gov­ern­ments.

In the legis­lature’s daily ques­tion period, New Demo­crat Leader Marit Stiles accused Ford of shrug­ging his shoulders at the news.

“This gov­ern­ment hasn’t woken up to the real­ity of what we’re facing today,” Stiles said, call­ing for a plan to save man­u­fac­tur­ing jobs in the face of Amer­ican tar­iffs and high unem­ploy­ment num­bers. “Where’s the fight that this gov­ern­ment talked about dur­ing the elec­tion?”

The post­pone­ment is a “gut punch,” Green Leader Mike Schreiner said as oppos­i­tion parties blamed Ford’s Pro­gress­ive Con­ser­vat­ive gov­ern­ment for axing sub­sidies for motor­ists to pur­chase EVs and for not build­ing up a bet­ter char­ging net­work, such as requir­ing EV char­gers installed in all new homes.

Lib­eral Leader Bon­nie Crom­bie ques­tioned whether the Ford gov­ern­ment’s heavy bet on EVs with Honda and other auto­makers was a “risk” given how anti­cip­ated demand has not panned out.

Ford, who was not in ques­tion period, told report­ers the gov­ern­ment will hold all auto man­u­fac­tur­ers given pro­vin­cial aid to their job­cre­ation prom­ises.

“Each auto man­u­fac­turer, any­thing that we’ve given them, we’re going to make sure that they’re held account­able and they con­tinue man­u­fac­tur­ing auto­mo­biles,” he said.

Despite delay, Honda signals it still intends to make EVs in Canada

This article was written by Adam Radwanski and was published in the Globe & Mail on May 14, 2025.

On the day that Mélanie Joly was sworn in as Canada’s new Industry Minister, one of the world’s largest automakers served warning that she has her work cut out for her when it comes to maintaining any momentum for this country’s nascent electric-vehicle sector.

The announcement by Honda Canada that it is delaying its $15billion plans to make EVs and EV batteries in Ontario, by at least two years, is on its face less damaging than some other recent setbacks for the industry.

Nobody is being laid off, as when General Motors last month halted production of its BrightDrop electric delivery vans, because Honda is maintaining its existing (non-electric) vehicle assembly. Nor is Honda equivocating (for now, at least) about its commitment to Canadian EV-making in the long run, in contrast to the uncertain futures of everything from Umicore’s plans to make battery materials in Ontario, to the Quebec battery plant that was under construction by troubled Northvolt AB.

“We have determined that the EV value chain initiative in Canada is essential to our electrified future,” Honda spokesperson Ken Chiu said on Tuesday. “There are no plans to cancel or relocate the project at this time.”

But in terms of what it says about how Canadian industry will weather the storm caused by U.S. President Donald Trump’s trade war, and by the impact of his anti-EV policies on an already slow-growing North American EV market, Honda’s decision to pump the brakes may be more unsettling than any of those other developments.

That’s because of both the nature of Honda’s plans, and the nature of the company itself.

Among the major government-backed EV-making investments announced in the past few years, Honda’s stands to be both the biggest and the best value from a Canadian perspective.

Whereas Stellantis NV and LG Energy Solution demanded up to $15-billion in cumulative production subsidies for a roughly $5-billion capital investment in a battery factory in Windsor, Ont., and Volkswagen Group similarly required up to $13-billion in production subsidies for a $7-billion battery plant, Honda settled for a comparatively modest $5-billion in subsidies for an investment that promises to be worth more than the other two combined.

Equally important as the dollar figures are what they cover. Honda’s plans are by far the broadest – encompassing not just battery-making but also vehicle assembly and a pair of partnerships, with Japan’s Asahi Kasei Corp. and South Korea’s POSCO Future M Co. Ltd., to produce battery materials.

For a federal government – and an Ontario provincial government – whose stated intention is to capitalize on Canada’s combination of natural resources and manufacturing expertise to build a start-to-finish EV supply chain, there could hardly be a better anchor investment. Nor is there one they could less afford to lose.

As for why Honda was willing to commit to it in the first place, without demanding that Canada match subsidies that were then available in the U.S. as Stellantis and Volkswagen did, a common refrain within the industry is that its corporate culture is different.

As with Toyota Motor Co., the other Japanese car-making giant with a long-time presence in Ontario, Honda has a reputation for being more patient and conservative in strategic decision-making than its North American or European competitors. It tends to stay and expand where it already has a footprint, and is less inclined to just follow whatever money governments are putting on the table.

That’s cause for some reassurance, about the postponement being just that, and not a sign that Mr. Trump’s war on the Canadian auto sector will cause Honda to pull up stakes and head south.

But when the least knee-jerk of companies feels compelled to significantly adjust course, it’s a sign of how strong the headwinds are.

In the here and now, Honda is forecasting a 70-per-cent drop in its net profit globally in the 2025-26 fiscal year, which it attributes largely to Mr. Trump’s tariffs.

In plan-making for the rest of this decade, it’s the uncertainty – about the ability to export into the U.S., about the extent to which North American EV demand will be throttled, about whether economic chaos affects purchases and investments of all sorts – that’s the obvious cause for adopting a wait-and-see attitude. Honda alluded to as much on Tuesday, apropos the investment in Canadian EV-making, when it said it will “continue to carefully monitor market conditions and reassess as needed.”

For Prime Minister Mark Carney’s new government, and to some extent Ontario Premier Doug Ford’s provincial one, the challenge will be to somehow mitigate that risk as much as possible, even if there is no way to eliminate it as long as Mr. Trump holds office.

There were a few hints of how they will attempt to do so during this spring’s federal election campaign, including Mr. Carney’s promise to explore purchase subsidies for EVs produced in Canada. But his government may have to move more decisively and expansively than those commitments suggested.

At the same time, Ottawa and the provinces (not just Ontario) now have all the more reason to try to expedite the mining of raw battery materials that are supposed to be one of the biggest draws for automakers that have committed to Canadian battery plants. The more completely the supply chain is taking shape, the more that starting or expanding production here will make sense, and the more that Canada will benefit.

That imperative is not a surprise, exactly.

At the end of last year, shortly before ending his tenure as industry minister – during which he had led Canada’s successful courtship of automakers’ EV-making commitments – François-Philippe Champagne told The Globe and Mail that the next step would be consolidating those investments.

It will now be up to Ms. Joly to make good on that, in a more urgent and fraught environment than Mr. Champagne or anyone else fully anticipated even a few months ago.

Honda delays Ontario EV plans in latest hit to Canada’s auto industry

This article was written by Eric Atkins, Laura Stone, and Jeffrey Jones, and was published in the Globe & Mail on May 14, 2025.

A drone view of Honda vehicles parked at the company’s automotive assembly plant in Alliston, Ont., in April.

Honda Canada says it is delaying a $15-billion electric-vehicle project in Ontario for two years amid weak demand for EVs, dealing more bad news to the province’s automotive sector.

The project includes retooling the company’s Alliston, Ont., assembly plant, a new battery plant nearby and two parts facilities elsewhere in Ontario. It was expected to create at least 1,000 jobs, producing as many as 240,000 cars a year by 2028.

Ken Chiu, a spokesman for Honda Canada, said the decision announced Tuesday has no impact on current employment or production levels at the Alliston plant.

It comes at a tough time for Canada’s auto industry, which has announced thousands of layoffs, as U.S. President Donald Trump’s tariffs take a toll. And it represents a setback for a project that was unveiled last year with great fanfare and backed with billions of dollars in government subsidies.

“It’s really about the marketplace demand, not tariffs in this case,” Mr. Chiu said. “The company will continue to evaluate the timing and project progression as market conditions change.”

Richard Norcross, mayor of New Tecumseth, which includes Alliston, said Honda has been an important part of the community for more than 40 years, and is the region’s largest employer.

Several companies in the region supply the plant.

“We are disappointed that the project is delayed,” Mr. Norcross said by phone, adding he is glad the Japanese automaker has committed to maintaining its existing plant. That plant makes the CRV and Civic, mainly for the U.S. market, with annual production of 420,000 vehicles.

Then-prime minister Justin Trudeau, Ontario Premier Doug Ford and other political leaders were on hand for the project’s unveiling last year, as Canada was making a broad push to be a leader in the automotive industry’s transition to electric vehicles.

Like other EV projects, it involved hefty public subsidies. The federal government offered up to $2.5-billion in tax credits for clean-technology and electric-vehicle supply chain investments, and Ontario pitched in up to another $2.5-billion for construction and site-servicing costs.

U.S. sales of battery-electric vehicles rose sharply until 2023 but have levelled off, according to data from Anderson Economic Group. The fourth quarter of 2024 saw 308,000 vehicles sold, for a 6.5-per-cent market share, compared with 305,000 in the same period of 2023.

U.S. lawmakers this week are set to vote on a proposal to kill US$7,500 tax incentives to buy EVs, along with fuel-efficiency rules to spur the production of greener automobiles.

Mr. Trump has imposed 25-percent tariffs on most foreign-made cars, discounted based on the level of U.S. content. The move is expected to drive up vehicle prices and reduce demand even further.

“The market-cooling consequences of U.S. tariff actions continue to be felt by everyone, Honda included,” said Flavio Volpe, head of the Automotive Parts Manufacturers’ Association, which represents 230 Canadian parts suppliers. He said Canada needs to find a solution to the tariffs that restores the confidence of companies driving large investments.

Mr. Ford told reporters Tuesday he’s spoken with Honda and is confident that the company will continue with its plans.

The Ontario Premier added that his government will hold auto manufacturers “accountable” for investments that the provincial and federal governments have made in their facilities.

Asked how U.S. tariffs are affecting auto investments, Mr. Ford said that Mr. Trump is making deals with other countries and he’s “very confident” that Prime Minister Mark Carney will be able to work alongside Mr. Trump to come up with a “mutually rewarding relationship.”

Automakers General Motors Co. and Stellantis NV have in recent days announced layoffs, shift reductions and temporary shutdowns at Ontario plants in Oshawa, Ingersoll and Windsor.

In April, Honda denied reports it was considering moving some Ontario production to the United States because of tariffs. The carmaker also produces the CRV in Indiana and Ohio, and the Civic in Indiana.

Volkswagen AG is on track to begin producing EV batteries at its plant in St. Thomas, Ont., known as PowerCo Canada, in 2027, spokesperson Tegan Versolatto said in a statement. The company announced the $7-billion project, which includes $700million in subsidies from Ottawa and $500-million from the Ontario government, in 2023. It is in the early stages of construction.

Another EV-related project, a Quebec plant that will produce battery materials known as cathodes, is also on schedule, one of its partners said. The joint venture of General Motors and South Korea’s POSCO Future is expected to cost more than $600-million, with financial support from the federal and Quebec governments accounting for about half the price tag. The project, called Ultium CAM, is due to begin production in 2026, said GM Canada spokeswoman Jennifer Wright.

A $7-billion battery plant in Quebec, launched by Northvolt AB, is stalled after its parent company filed for bankruptcy protection in the U.S. and its home base of Sweden, blaming the downturn in demand as the global industry struggles to compete with China.

Canada went all in on EVs and batteries in recent years, with governments, automakers and their partners announcing billions of dollars in plants in Ontario and Quebec, in expectation that sales of zero-emissions cars and trucks would remain on a steep trajectory. But global sales slowed as consumers balked at rising costs. In January, Mr. Trump scrapped a target, set by former president Joe Biden, for 50 per cent of new cars sold in the U.S. by 2030 to be electric. Meanwhile, Mr. Trump’s tariffs on auto-sector imports have added a new layer of uncertainty for the industry.

Regardless of Honda’s reasons for delaying its EV plans, it shows that Canada has to do a better job of defining in which aspects of the industry it has competitive advantages, said Matthew Fortier, chief executive officer of Accelerate. His organization is made up of companies and organizations from several industries aiming to build the country’s EV supply chain. He said Canada holds advantages in the development of critical minerals, ramping up battery materials processing and technological innovation, areas that could counteract China’s dominance.

“I really think Canada still has an important opportunity in EVs in front of us, but we can’t wait any longer,” Mr. Fortier said.

Trans Mountain CEO is hopeful new pipeline can be built within next decade

This article was written by Emma Graney and was published in the Globe & Mail on May 13, 2025.

Expansion of the Trans Mountain pipeline, which terminates where tankers and outdoor enthusiasts co-exist in Burnaby, B.C., at the Westridge Marine Terminal, cost $34-billion by the time it was finished.

Hoping to harness mood shift amid trade war, Mark Maki urges more efficient building process

The head of Trans Mountain Corp. is optimistic that a new pipeline to carry landlocked crude to a Canadian coast – be it North, East or West – can be built within the next decade.

Mark Maki believes Canada can be a major oil and gas exporter in the face of massive trade uncertainties that are roiling global markets, and part of the key to that is to build new infrastructure to reach overseas markets.

“Realistically, it’s not a bad long-term economic call on the part of the country to see enhanced access to tidewater,” he said in an interview Monday. Is that optimism or realism? “In this space, you have to be a bit of an optimist,” he said.

The conversation around new pipelines in Canada has shifted markedly over the past six months. Where Canadians – particularly those in the East – once balked at the notion of more pipelines, the stark reality of U.S. President Donald Trump’s trade war has caused a seismic shift in thinking. A Nanos Research poll in April indicated that nearly three-quarters of Canadians support an East-West pipeline for oil and liquefied natural gas.

For all the talk of new pipelines, however, Mr. Maki says the first step is to optimize Trans Mountain’s existing capacity.

The line saw its highest volumes to date in March, hovering around 790,000 barrels a day. But the system can carry more, he said.

If there is commercial support to boost capacity, then Trans Mountain will move ahead with projects to do so, he said. That would include ramping up power on the line and using additives that would help oil move faster through the pipe.

“We’ve got to do the easy things first,” he said. “Then, in the background, you can look at, ‘Okay, is there support for another pipe somewhere? Is there contractual support for another pipe somewhere?’ Because no one’s going to do it without economic certainty.”

That’s where Trans Mountain comes in. After all, the company was specifically set up to build and run pipelines.

“We can do more of that. So I am hopeful for Canada’s own good that we see more infrastructure development and development of the resource.”

Mr. Maki believes Canada can lead the world in all forms of energy, be it renewables, oil or natural gas. And being a major exporter will be all the more critical as reserves in the Permian basin, which comprises roughly half of U.S. oil production, continue to decline.

When he first moved into the role of CEO, Mr. Maki viewed Trans Mountain as a business that simply needed to be tended to, and the returns harvested. Then came Mr. Trump’s trade war, which he said was “an eye-opener for everybody.”

The bullheaded approach from Washington on tariffs had leaders of both major parties here pitching the importance of Canadian energy sovereignty during the recent federal election.

Liberal Prime Minister Mark Carney has since pledged to “build, baby, build,” and make Canada an “energy superpower” by pushing major projects forward at a pace not seen in generations.

The prospect of a new pipeline system needs to be part of the discussion around energy, Mr. Maki said. He’s hopeful that will be the case, given the recent change in tone from Ottawa under Mr. Carney.

“We have to find a way to get infrastructure done here more effectively,” Mr. Maki said.

The bullheaded approach from Washington on tariffs had leaders of both major parties here pitching the importance of Canadian energy sovereignty during the recent federal election.

“Because if we keep doing it this way, everything is going to be epically expensive. Whether it’s a power line, a gas pipeline, an LNG facility, a critical minerals processing facility – all of it will be incredibly expensive.”

Mr. Maki took the reins of Trans Mountain on Sept. 1, moving into the top spot from his previous role as chief financial and strategy officer. Prior to that, he was with Canada’s largest pipeline operator, Enbridge Inc., for 34 years.

The long-delayed Trans Mountain expansion ended up costing $34-billion. The project was built to open up lucrative overseas markets for Canadian oil and remove a price discount that had existed for years because of overreliance on exports to the United States.

Kinder Morgan Inc., the U.S.based company that owned the Trans Mountain oil pipeline, proposed the project in 2012, pegging the cost at $5.4-billion. It was acquired by Canada in 2018 after Kinder Morgan, frustrated with delays and deepening regulatory scrutiny, threatened to walk away from the project.

Construction was slowed by the COVID-19 pandemic as well as wildfires and floods, and ended up several years and tens of billions in cost overruns beyond the initial target.

The federal government eventually wants to sell Trans Mountain, but Mr. Maki said now is not the ideal time. There is uncertainty about the outcome of court challenges over the cost of shipping rates, for example, and the corporation is still looking at adjustments to the system to boost volumes.

And while he acknowledged that the pipeline sector continues to face opposition, including environmental groups pressuring banks to avoid insuring the line, he said “the narrative around pipelines has become a lot more constructive since the tariff noise from the U.S.”

Canada’s EV strategy has failed, and there are lessons to learn

This opinion was written by Jim Hinton and was published in the Globe & Mail on May 12, 2025.

We must face an uncomfortable truth: Canada’s automotive and electric-vehicle manufacturing strategy, touted as a generational opportunity to drive economic growth, jobs and environmental leadership, has failed quickly and dramatically.

The federal and Quebec governments made a bad $4.6-billion-dollar bet on Northvolt, a Swedish EV battery manufacturer, which has entered bankruptcy less than two years since a $7-billion investment announcement. The $270-million invested by Quebec in Northvolt’s parent company in Sweden is now “lost,” confirmed the provincial government in March.

The head of Canada’s Building Trades Unions called the subsidizing of foreign workers building the EV battery plant in Windsor, Ont., “a slap in the face” and an “insult to Canadian taxpayers.” And Umicore, another multibillion-dollar project championed by our politicians near Kingston, said in a statement the company has “prioritized maximizing the use” of its battery materials plants in Poland and Korea, rather than build the new project in Ontario.

Canada’s EV strategy appears to be nothing more than a $57-billion politically driven stunt disconnected from economic realities. Yet there is something good to come out of it: There are many valuable lessons we can and should learn, especially now in this new global trading reality and as the new wave of politicians are rethinking how to strengthen Canada’s economy and security in the intangibles economy.

Despite proclamations about good jobs, how many new jobs are truly created, rather than being reshuffled away from domestic industries? Today EV and automotive factories rely predominantly on automation and robotics, not workers – just 7 per cent of a car’s value goes to labour.

But won’t these foreign firms pay Canadian taxes? Foreign EV firms such as Volkswagen and Stellantis are exempted from paying taxes on the financing they receive from Canadian taxpayers. Meanwhile Canadian firms continue to pay taxes and aren’t receiving the same subsidies, so they are effectively punished for being Canadian and small. Is it any wonder that Canadian companies such as Electrovaya are incentivized to grow in the U.S. instead of here.

Canada does not get the wealth effects from these investments. Because of the nature of contemporary economy, the benefits go to the owners of intellectual property (IP) embedded in the technology, not those that buy or install it. Canada once owned the EV technology via publicly funded research at Dalhousie University, but it gave it all away to foreign firms.

In the traditional, production-based economy, foreign direct investment (FDI) into Canada brought advanced production technology, management expertise, local supply chain opportunities, new jobs and new tax base for Canada. But FDI in the innovation economy is extractive and the flow of technology, revenues and tax base, knowledge asset and critical technical personnel is out of Canada. The value accrues to the companies and countries that own and control the technology, not those that make or use the technology.

Canada’s EV strategy also overlooked the geopolitical and technological forces facing the country. China’s BYD has been steadily rising over the years, rapidly filing EV patents, eventually becoming the best-selling EV company utilizing a different lower cost battery technology. Between 2009 and 2022, China spent $38-billion to create an industry in which BYD alone has reached US$100-billion in revenue. For those who say Canada can’t have its own globally relevant automotive companies, compare China’s strategic investment with Canada’s nearly $60-billion commitment over the last two years for no ownership or control and fewer than 10,000 jobs, which are currently being automated.

In response to the U.S. automotive-focused tariffs, Canada’s Prime Minister has signalled that he will hand out some of the up to $8-billion in Canadian-raised countertariffs to foreign-owned and -controlled automakers, apparently taking the same approach not supported by contemporary economic analysis, which has spectacularly failed for the battery plants. Given the continuing attacks on the Canadian automotive industry and the swift failure of Canada’s very expensive EV strategy, this more-of-the-same non-sovereign approach will continue to be disastrous. Canadians needs a real Canada first strategy – one with Canadian owned innovation at its centre.

Poil­ievre pledges reversal of EV quota rules

Tory leader says his gov­ern­ment would hon­our all other exist­ing agree­ments with auto sec­tor

This article was written by Raisa Patel and was published in the Toronto Star on April 25, 2025.

A Pierre Poil­ievre ­led gov­ern­ment would main­tain all exist­ing gov­ern­ment agree­ments for the auto sec­tor, the Con­ser­vat­ive leader said Thursday.

“We will hon­our all agree­ments for the auto sec­tor that the gov­ern­ment has made, but we will not force Cana­dians to pay a $20,000 tax on auto­mo­biles,” Poil­ievre said at a news con­fer­ence in Hal­i­fax.

“We will con­tinue to sup­port the bat­tery plants, the EVs and the other com­mit­ments the gov­ern­ment has made, because we don’t believe in tear­ing up agree­ments.”

The Par­lia­ment­ary Budget Officer estim­ated in 2024 that fed­eral sup­port for elec­tric vehicle invest­ment in Canada totalled as much as $31.4 bil­lion, while pro­vin­cial sup­port was up to $21.1 bil­lion.

But the “$20,000 tax” Poil­ievre referred to — the focus of his announce­ment on Thursday — is tied to former prime min­is­ter Justin

Trudeau’s tar­get that zero ­emis­sion vehicles should make up 20 per cent of new car sales start­ing in 2026, grow­ing to 100 per cent by 2035.

The Con­ser­vat­ive leader has now renamed part of the policy the “Car (ney) tax,” in ref­er­ence to Lib­eral Leader Mark Car­ney.

Poil­ievre has claimed that if auto­makers don’t meet those quotas, they may be fined up to $20,000 for every vehicle they fall short of that tar­get total — in other words, car man­u­fac­tur­ers who sell gas­powered vehicles exceed­ing the “Lib­eral quota” will be slapped with a “$20,000 tax” per vehicle.

“I think they’re try­ing to say not selling enough EVs is the same as selling too many gas cars. And so they’re kind of sim­ul­tan­eously say­ing not enough EVs is a $20,000 fine, and too many gas cars is a $20,000 tax,” said Joanna Kyriazis, the dir­ector of pub­lic affairs at Clean Energy Canada.

But neither of those claims are accur­ate, Kyriazis said.

While both B.C. and Que­bec have zero ­emis­sion vehicle man­dates that come with a $20,000 pen­alty per vehicle that misses the quota, the fed­eral reg­u­la­tions are dif­fer­ent.

“Under the fed­eral EV avail­ab­il­ity stand­ard, there are no mon­et­ary pen­al­ties for non­com­pli­ance,” Kyriazis said.

“The $20,000 that they’re refer­ring to is a com­pli­ance path­way where if a car­maker can­not meet its require­ments in a given year based on how many EVs it makes avail­able for sale in Canada, that car­maker can instead choose to invest in char­ging infra­struc­ture to earn cred­its instead,” she said. “And for every $20,000 inves­ted in char­ging infra­struc­ture, a car­maker can earn one credit. So it’s not a pen­alty, it’s a com­pli­ance flex­ib­il­ity.”

Poil­ievre’s sug­ges­tion, there­fore, that an auto­maker selling too many gas­powered cars will get hit with a $20,000 “tax” is mis­lead­ing, Kyriazis said.

She said that aside from invest­ing in char­ging infra­struc­ture for elec­tric vehicles, man­u­fac­tur­ers can also pur­chase cred­its from other auto­makers — something Poil­ievre has argued will bene­fit for­eign car­makers like Tesla.

There are also grace peri­ods, Kyriazis said, “where if an auto­maker doesn’t com­ply in a given year, they have a couple more years to make it up and earn and sell more EVs in future years.”

“There’s a lot of wiggle room in any given year,” she said.

“If they can’t earn enough cred­its in a given year using any of those com­pli­ance path­ways, then they are at risk of fed­eral pro­sec­u­tion.”

The Con­ser­vat­ives have poin­ted to research that indic­ates that the man­date will lead to job losses in the auto sec­tor, and on Thursday high­lighted an endorse­ment from Brian King­ston, the head of the Cana­dian Vehicle Man­u­fac­tur­ers’ Asso­ci­ation, who said that “man­dat­ing EV sales when the auto industry is under attack from U.S. tar­iffs is put­ting the puck in our own net.”

Imperial Oil can weather turmoil from U.S. trade war, CEO says

This article was written by Emma Graney and was published in the Globe & Mail on April 18, 2025.

Imperial Oil Ltd. chief executive Brad Corson says the Calgary-based company can weather the current trade war-induced economic storm thanks to a strong balance sheet and a low cost structure.

It’s a sentiment shared by many in the Canadian oil sector, which has mostly been spared the tariffs imposed by U.S. President Donald Trump on goods from various other industries.

On April 2, Mr. Trump announced a sweeping set of tariffs against countries around the world, but paused them on April 9 in the wake of market chaos.

Speaking at the company’s investor day Thursday, Mr. Corson said navigating the current economic uncertainty comes down to having a strategy that is resilient over a wide range of scenarios – including where the world finds itself today.

Imperial is approaching this period of market volatility with a philosophy similar to the one it took during the height of the COVID pandemic, he said.

In April, 2020, demand for fuels crashed as billions of people around the world stayed home and a price war raged between Saudi Arabia and Russia. Oil prices nosedived into negative territory for the first time in history, forcing producers to batten down the fiscal hatches, cut costs as much as possible and exercise extreme economic discipline.

“That discipline has continued even in much more favourable environments that we have experienced the last several years, and that now positions us even better today than where we were back in 2020,” Mr. Corson said. “It’s really those foundational elements that are going to guide us through this uncertainty, but fundamentally stay the course.”

Incoming CEO John Whelan takes the reins on May 8, when Mr. Corson retires. He said Thursday that he intends to continue building Imperial’s financial resilience. But as a commodity business, he said, “I feel like we’ve been preparing for this for years. It was just a question of what would roil the markets next.

“What was it going to be? OPEC producing more barrels? Was it tariffs? Was it differentials?” he said. “We’re preparing for this all the time and that’s what gives us resilience in the current environment.”

SUPPORT FOR CANADA’S OIL-AND-GAS SECTOR GETS A TRUMP BUMP

This opinion was written by Nik Nanos and was published in the Globe & Mail on April 12, 2025.

Even with the current common sense of purpose, will today’s urgency to act in response to the change in Canada-U.S. relations be politically sustainable?

Nik Nanos is the chief data scientist at Nanos Research, research adjunct professor at the Norman Paterson School for International Affairs at Carleton University, a chair of the Advisory Council of the University of Ottawa’s Positive Energy program, and the official pollster for The Globe and Mail and CTV News.

Almost 20 years ago, Conservative prime minister Stephen Harper asserted Canada was an energy superpower. Under Justin Trudeau and the Liberal government, the narrative was not about flexing our energy muscles, but on reducing greenhouse-gas emissions and shifting to green energy.

And then along came Donald Trump. The U.S. President has driven home to Canadians the importance of Canada’s oil-and-gas sector. His administration has implemented tariffs on aluminum, steel and the automotive sector, but oil and gas was left alone. This drove home to Canadians the importance of the oil and gas sector – not just to the Canadian economy, but to the American economy, as well.

Even after almost 10 years of a federal government telling Canadians the country needs to move away from oil and gas, support for the sector remains high – and is increasing.

The University of Ottawa’s Positive Energy program and Nanos Research have been tracking public opinion on a wide range of perceptions over the years. Among the more striking findings is that in the past five years, a growing number of Canadians believe that the oil and gas sector is important to the current economy. Back in 2020 about two out of three people (65 per cent) thought the oil and gas sector was important to Canada’s current economy. As of January, this figure has increased to 88 per cent.

When asked an open-ended question where respondents could say anything to explain their view, the key positive drivers included the sector’s contribution to jobs and provincial economies (42 per cent) and that oil and gas are resources that should be exploited (10 per cent). As context, there were so few individuals who said oil and gas was not important that it did not meet the criteria to be included in the results.

We see a similar trendline when we ask about the future. In 2020, 41 per cent of respondents believed the oil and gas sector would be important to Canada’s future economy; in 2025, it’s 70 per cent.

Canadians have consistently handed out failing marks to federal and provincial governments for how they co-operate – or don’t – when it comes to energy. People are six times more likely to give a rating of poor (32 per cent) or very poor (21 per cent) rather than a good (8 per cent) or very good (1 per cent) score. Not surprisingly, the negative ratings jump from 53 to 78 per cent in the Prairies. We should not be surprised when Alberta Premier Danielle Smith comes out swinging at anything that might jeopardize the oil and gas sector.

Considering those positive numbers on the sector’s importance to the Canadian economy, you’d think people were buying into the “drill baby drill” mantra of Donald Trump.

But Canadians are twice as likely to think that the country should not be aligning our energy policies with the United States; 61 per cent answered “not align/ somewhat not align,” while 28 per cent said “align/somewhat align.” Reasons to oppose alignment range from the view that the United States is disregarding climate change (29 per cent), that Mr. Trump can’t be trusted (18 per cent) and that Canada needs to remain independent (17 per cent).

At the same time, support for the government to fund a new pipeline from Alberta to Eastern Canada is quite strong (53 per cent support, another 24 per cent somewhat support it). Although the percentage of those in Quebec who favour the pipeline is lower than the national average (59 per cent in Quebec compared to 77 per cent nationally), it is still a majority opinion.

The key takeaway is that in the wake of an unpredictable relationship with the Trump administration, Canadians are quite supportive of a new governmentfunded oil pipeline from Alberta to Eastern Canada.

Even with the current common sense of purpose, will today’s urgency to act in response to the change in Canada-U.S. relations be politically sustainable?

Perhaps the positive news is that Mr. Trump has inspired a rethinking in Canada when it comes to our energy future.

Mr. Trump’s reticence to slap tariffs on Canadian oil has put a spotlight on the importance of the sector to both Canada and the United States, and has initiated a dialogue between the federal and provincial governments on energy resilience and the importance of a national energy strategy.

A thank you to Mr. Trump may be in order.

Perhaps the positive news is that Mr. Trump has inspired a rethinking in Canada when it comes to our energy future.

U.S. oil firms: Publicly quiet, privately worried about Trump’s levies

This article was written by Rebecca F. Elliott and was published by the Globe & Mail on April 9, 2025.

Oil is trading at its lowest level in nearly four years. Costs are rising. And Wall Street is growing more worried by the day that President Donald Trump’s trade policies will tip the United States into a recession.

The reaction in the oil patch? Silence, mostly.

Oil and gas executives, eager to stay in Mr. Trump’s good graces, have offered little public criticism of the President or the tariffs he has rolled out over the past few months. In private, however, they have decried the uncertainty he has sown, including in a recent anonymized survey by the Federal Reserve Bank of Dallas.

If U.S. oil prices fall much lower than US$60 a barrel, around where they were trading Monday, companies could be forced to slow drilling, slash spending and most likely lay off workers, hurting states such as Texas.

Oil executives donated millions of dollars to help elect Mr. Trump, who has championed the industry. But if the past few days are any indicator, having a friendly ear in the White House goes only so far.

“Everybody’s afraid,” said Dan Pickering, chief investment officer for Pickering Energy Partners, a Houston financial services firm.

Executives in other industries such as finance and technology who have been closely aligned with Mr. Trump have gone further in urging the President to soften his trade policy.

Mr. Trump has said he wanted to reset trading relationships that he has long described as unfair to the United States.

Ben Dietderich, a spokesperson for the Energy Department, said in a statement that the administration’s policies “benefit American consumers while also reducing regulatory burdens on energy producers, making it less costly to operate in the United States.”

Soon after Mr. Trump’s inauguration, the oil industry did urge him to reconsider tariffs on Canadian and Mexican oil. Mr. Trump largely reversed course and also exempted energy from the tariffs he announced last week.

Even so, oil prices have plunged, as have energy company stocks. By the end of the trading day Monday, shares in Exxon Mobil and Chevron, the largest U.S. oil companies, had fallen around 13 per cent and 16 per cent since Wednesday, when Mr. Trump announced his latest tariffs. Neither company made its CEO available for an interview.

Smaller firms were faring even worse. Shares of Liberty Energy, the Denver fracking company that the energy secretary, Chris Wright, previously led, were down about 35 per cent.

Compounding the effects of Mr. Trump’s trade policy, the cartel known as OPEC+ decided last week that it would pump even more oil, beginning in May. That set off concern that supply would outstrip demand, which could weaken if the global economy slows.

“You’re at a point now where probably in every C-suite in our sector, it’s got their attention,” Tom Jorden, CEO of Coterra Energy, one of the biggest U.S. oil and gas producers, said Friday, when oil fetched around $US62 a barrel.

Asked his opinion on the tariffs that sent global markets spiralling, Mr. Jorden demurred. “I don’t have one,” he said. “I understand that the President is choosing to do difficult things first.” Others urged patience. “We elected him knowing this was coming, right?” said Michael Oestmann, president of a smaller oil and gas company, Tall City Exploration IV, in West Texas. Mr. Oestmann said he hoped the market would quickly bounce back.

“You have to let it play out and see how it goes for a few weeks here at least,” he said.

Privately, executives have expressed more trepidation. Anonymous responses to a March survey of oil and gas companies by the Dallas Fed were littered with complaints about uncertainty and rising costs for materials such as steel, which is subject to a 25per-cent tariff.

“I have never felt more uncertainty about our business in my entire 40-plus-year career,” one respondent wrote.

Another called for stability: “The administration’s chaos is a disaster for the commodity markets. ‘Drill, baby, drill’ is nothing short of a myth and populist rallying cry. Tariff policy is impossible for us to predict and doesn’t have a clear goal.”

When oil executives have pushed back, it has often been in response to the idea floated by Peter Navarro, a White House aide, that the administration would like oil prices as low as US$50 a barrel.

“When you get down to that $50 oil that you talked about, then you’re below the point that you’re going to drill, baby, drill,” Harold Hamm, one of Mr. Trump’s biggest oil industry backers, told Bloomberg last month.

It will be some time before the recent oil-price slide shows up as lower prices at the pump. A gallon of regular gasoline averaged about US$3.26 on Monday, up slightly from last week, according to the AAA motor club.

Natural-gas prices have proved more resilient to the market upheaval, insulating some companies. Still, some expressed concern that more countries would follow China’s lead in retaliating with steep tariffs on U.S. exports, including liquefied natural gas. If China’s latest round of tariffs takes effect as planned this week, U.S. gas will face taxes of nearly 50 per cent.

“If natural gas gets caught in the centre of this tariff war, trade war, it will have a direct negative impact,” said Matt Kurzejewski, the CEO of Costy’s Energy Services, a Pennsylvania-based gas services company.

For now, though, Mr. Kurzejewski described himself as “cautiously optimistic” about Mr. Trump’s policies.