Evidence of meeting #14 for International Trade in the 41st Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was union.
A recording is available from Parliament.
12:50 p.m.
Conservative
Ed Holder Conservative London West, ON
It'd be interesting to know what percentage of businesses actually know—
12:50 p.m.
Conservative
Ed Holder Conservative London West, ON
—because those are the job creators. Those are the ones that will take advantage not only of your services, but buy Mr. Nantais' cars and so on. It strikes me that the key is what percentage of businesses know.
12:50 p.m.
Vice-President, Public Affairs, UPS Canada
Definitely. That's more work that we're going to be continuing as we move forward.
I can say that in our conversations with associations that we belong to that, while the larger companies certainly are engaged and aware, and some of the smaller companies may have a general awareness, they certainly haven't dug into the details.
12:50 p.m.
Conservative
Ed Holder Conservative London West, ON
Fair enough. In your testimony you made an interesting comment about establishing a single window. You went into some detail as to what that involves in terms of clearance of goods into the EU. How can we do that better?
12:50 p.m.
Vice-President, Public Affairs, UPS Canada
We see a lot of alignment, like my colleague with the beyond-the-border objectives of regulatory harmonization and the progress that we're making there. So we're trying to implement a single window when you're importing into Canada from the U.S. In the past you would have had to file with maybe nine or ten different government agencies for one commodity. This year we hope we're going to have a single window, where it would just go through one electronic window and all agencies could approve that.
We would like to see the same thing between Canada and the EU, where they don't have to file with all these different departments to get the goods released.
12:50 p.m.
NDP
Laurin Liu NDP Rivière-des-Mille-Îles, QC
Thank you, Mr. Chair.
Mr. Nantais, my questions are for you. I found your testimony very interesting and I thank you for it.
I am the federal member of Parliament for the city of Boisbriand which is located north of Montreal. In my area we know very well that free trade does not necessarily translate into more jobs. As you may know, the only automotive assembly plant in Quebec, which used to employ 3,200 people, closed its doors in 2002, despite all of the promises that went along with the Auto Pact and NAFTA. In your statement you did make it clear that free trade will not necessarily help the workers in my riding.
You also mentioned that European manufacturers want to export more cars to Canada. We already have a relatively high trade deficit with the European Union in the auto and auto parts sector. If I am summarizing your position correctly, this agreement between Canada and the European Union is going to increase Canada's trade deficit regarding autos and auto parts. Is that actually what you said?
12:50 p.m.
President, Canadian Vehicle Manufacturers' Association
I'm not saying that it would further increase the trade deficit in autos. I would say in the initial stages there will probably be a continued imbalance. The former ambassador spoke about competition. We believe we can compete in any place and any market around the world. Again we have to have fair access to those markets. We have to have access without constantly putting up new non-tariff barriers and so forth. When that happens, we think that Canada can compete in any global market.
12:50 p.m.
NDP
Laurin Liu NDP Rivière-des-Mille-Îles, QC
You said that in order to adapt to the realities of free trade, plants would have to follow suit. Could you provide us with more details on that? What investments will be required to update those plants?
12:50 p.m.
President, Canadian Vehicle Manufacturers' Association
Plants are already undergoing an evolution. The new Ford announcement for instance is geared to a product that is intended for the global market. That means having an awareness of the product in that market and whether it's going to be acceptable and successful. That's a question of putting in place the innovation necessary in terms of advanced technologies in manufacturing to become more productive, and that includes quality and so forth.
So these plants will change so that they are able to produce products not just for Canada or the United States or North America or the western hemisphere but virtually everywhere. Ultimately, you can't do that overnight because the auto industry is a very high-capital investment industry. A new plant is basically $1 billion or more.
We've taken out a lot of capacity in Canada because of the recession, but the resulting plants are in a better position to compete with products abroad and produce the actual product for those markets. It's an evolutionary process but it does take time. The key being high-capital investment in making the business case to ensure that we get a new product mandate that is global in nature. When I speak to the “A Call to Action” report, there are several aspects there that would constitute the basis for that new positive business case for expanding plants.
12:55 p.m.
NDP
Laurin Liu NDP Rivière-des-Mille-Îles, QC
Mr. Nantais, I have several other questions I would like to put to you.
12:55 p.m.
NDP
Laurin Liu NDP Rivière-des-Mille-Îles, QC
They mostly bear on the following topic.
A study conducted for Foreign Affairs, Trade and Development Canada predicted that the possible effects of a CETA with the EU on the Canadian automotive sector would lead to a 0.16% reduction in automobile production in Canada.
Are you aware of that figure?
12:55 p.m.
President, Canadian Vehicle Manufacturers' Association
I'm somewhat aware of those numbers. That's a report that is fairly old at this point in time.
It's really a question of what transpires, what the details of this agreement are, and how we are able to benefit from those, so I'm not going to put a lot of weight on those numbers at this point in time.
12:55 p.m.
Conservative
Randy Hoback Conservative Prince Albert, SK
Thank you, Mr. Chair.
I'm going to share my time with Mr. Shipley, just so you're aware of that.
12:55 p.m.
Conservative
Randy Hoback Conservative Prince Albert, SK
Yes, exactly.
Ms. Falcone, you talked about red tape and elimination around customs and red tape, and I agree with you. I think we need more than five minutes to talk about examples of that, so if you have some examples of that I would definitely encourage you to submit them to the committee on things that we could identify that we should be addressing in that area.
When I am kind of curious about—and Mr. Holder touched on it a bit—is when we do a deal like this, it is such a big deal that I get concerned that the business community, especially small business, doesn't recognize the opportunity that's there. I wonder if there is responsibility for the government to be part of creating that awareness. Is there a responsibility for the business community to step up and make that information available? What do you think?
12:55 p.m.
Vice-President, Public Affairs, UPS Canada
Sure there is. Certainly for the business community, the associations, private sectors that are going to benefit, it's our responsibility to educate.
We would just encourage the government to continue to do what you've done through this initial text in getting the word out, and if with the provincial counterparts you can do that as well, we think that would be helpful.
12:55 p.m.
Conservative
Randy Hoback Conservative Prince Albert, SK
The advertising, education part of it is very important.
12:55 p.m.
Conservative
12:55 p.m.
Conservative
Bev Shipley Conservative Lambton—Kent—Middlesex, ON
Thank you very much.
Actually the last one is quite a question because it's one of the ones that we struggle with when we do announce good things, for which there is sometimes criticism. These are so important.
Mr. Nantais, I have just a quick question. I want to follow up on my colleague. When we met with the auto industry people they told us that Canada is the most expensive country in the world in which to produce auto parts or automobiles. Your comment, which is very good, is that you believe, as auto manufacturers, that you produce where you sell, which means that you produce in Canada. You produce in North America and you produce in Europe. I think you said the number was for every 10, every 1 that we sell to Europe, we get 1 back, or is it maybe internationally?
I guess I'm trying to understand the fact that we don't have European manufacturers in Canada. You've indicated Canada is one of the most expensive countries in the world in which to produce. How is that number going to change when we don't have European manufacturers in Canada? There's a consumer preference, obviously, by a number of consumers to have European automobiles.
