Hi. My name is Huw Williams, and I'm the director of public affairs with the Canadian Automobile Dealers Association.
It has been a very interesting year in the car business, so we appreciate the opportunity to come and update you on the situation.
As you know, we represent 3,500 franchised automobile dealers of all makes and models from across the country, 140,000 employees, so we are the largest employer in the car sector.
I'm proud to say that we just got back from our board of directors meeting in Edmonton, where—tying into our last speaker—the Alberta motor dealers were recognized as the largest contributor to the Special Olympics, hitting over the half-million dollar mark in terms of contributions.
One of the things I'm conscious of is that our written submission to the committee deals with vehicle scrappage. Events have overtaken us a little bit with respect to that, because the Minister of the Environment has made it clear that we're not going to see an advanced vehicle scrappage program like they have in the United States with the cash-for-clunkers program. We respect that decision, but we feel it's important to highlight a couple of public policy elements of that decision and the overall need to support getting older vehicles off the road.
First of all, many committee members may not be aware that Canada already has a $300 program, the Retire Your Ride program, to get older vehicles off the road. That $300 program was world-leading when it was introduced in January of this year. We got calls from jurisdictions all around the world asking how that program worked and how it was applicable. The genesis of that program was a $92-million government investment over four years to get older vehicles off the road. The public policy objective behind that was basically to get older, higher-polluting vehicles off the road.
Picture a 1990 or pre-1990 vehicle, an older vehicle, at a stoplight. It produces 33 times more smog and regulated emissions than a new vehicle. For each one of those older vehicles you remove from the road, it's like getting 33 new vehicles off the road. Overall, removing 100,000 older vehicles is like removing 3.3 million new vehicles from the road.
So there's a significant air quality investment that is part of the equation to get older vehicles off the road. Even if you look at a 1995 vehicle, for example, that produces 18 times more regulated emissions in smog than a new vehicle does today.
Our major message with respect to vehicle scrappage is that this $92-million investment over the next four years should be maintained and perhaps modestly adapted to reach the public policy objectives going forward in the future.
One of the ironies, and I'd be remiss if I didn't point this out to the committee, is that while the government on one hand is paying $300 to get older vehicles off the road, there's a loophole in Canadian importation legislation that allows older, higher-polluting vehicles to be dumped into the Canadian marketplace. Vehicles that are over 15 years of age are allowed to be imported into Canada, and they don't have to comply with either the Canada Motor Vehicle Safety Standards or emission standards.
Most of these vehicles are coming from the Japanese marketplace, where they're banned from the road. The steering wheels are on the right-hand side, so you're talking about vehicles that are a safety danger. Obviously they don't meet the emissions requirements, with up to 30 times more regulated emissions than Canadian vehicles. Independent studies by the insurance industry show—this is just common sense, with the steering wheel on the wrong side of the car—that they get into 40% more accidents than ordinary vehicles.
These vehicles are being dumped into Canada because the rules that deal with vehicle importation were set up in the early 1970s, and at that point in time, a car that was over 15 years old was considered an antique. If you think about that, it kind of made sense that a 1955 car was an antique in that day and age, but now what is happening is that these vehicles are being dumped into the Canadian marketplace.
Australia has moved to put a 30-year threshold on this. A raft of other Asian and European countries have moved in a similar direction. The United States has a 25-year threshold that they've put in place. As a result, Canada is really the last bastion where they're allowed to dump these older, higher-polluting vehicles.
We're talking about 15,000 vehicles a year. It's not a sales issue for us. We sell 1.6 million new vehicles a year, so losing 15,000 sales is not a concern for us on this issue, but this is an environmental and public policy issue that needs to be addressed.
I'd be happy to answer the committee's questions with respect to the rollout of the Canadian secured credit facility program. We highly support the government's initiative on the $12-billion worth of financing.
I'd also be happy to address other issues related to the budget going forward.
Thank you.