Indeed. I will not only correct the record; I will refer back to the Hansard.
I will confirm with Mr. Volpe. I just saw him this morning, which is why he was on my mind. He's doing, I think, good, hard work on behalf of his members in Ottawa as well as with his membership. I will make sure I am correct.
I appreciate the correction, because I was so enamoured sharing the story of our family Impala, which had a front bench that could seat three. It's a feature of a vehicle that's gone away now. I know that it's missed by my family, even though we're a family of four. You always need that sixth middle-bench seat in some fashion. It's one of the little things we lament as this sector changes.
I'll go back to the history of this file. I want to share a bit about the context of why this is so important. I won't make a specific editorial commentary on it just yet, but that is coming. This comes from Mr. Anastakis's book entitled Autonomous State. I think it helps us understand why we are so focused on this as a committee.
This is from the conclusion of his book:
Half a century ago, a very simple idea about the Canadian auto sector started to take hold in the political and public imagination. The auto industry’s importance to the Canadian economy and body politic could be summarized by a basic equation, an easy-to-remember ratio that varied only slightly in the decades to follow. Whether accurate or not, the notion that such a sprawling and complex industrial sector could be boiled down to a simple rubric made it very appealing. It gave politicians and policy makers a convenient rhetorical hammer by which to drive home the industry’s importance and, perhaps more significant, justify their actions in the automotive field. It is not that the ratio wasn’t true, because it essentially was; then, as today, the production of automobiles remains without question the largest and most important economic sector in North America.
This book is a bit dated, but I think a lot of these facts continue to hold. This book is from 2013.
I'll continue:
It began innocuously enough. In a 1960 CBC television report on the problems in the industry, journalist Norman DePoe claimed that “one business in seven” in Canada was automotive or auto-related. A few years later, a young economics student at the University of Windsor ran an input-output analysis of employment in Ontario and came up with the startling result that one in six jobs in the province was connected in some way to the automotive sector. That student, Dennis DesRosiers, was hired by the provincial government as an auto analyst in the early 1970s, and his figure was used in a 1974 budget statement.
I think Mr. DesRosiers' advice is one that has been useful to many governments of many political stripes over the decades since.
I'll go back to Mr. Anastakis:
By the mid-1970s, “one in six” had become a mantra repeated almost as often as “fair share.” Ontario Treasurer Darcy McKeough stated in the legislature in 1976 that the auto industry supported either “directly or indirectly, one in every six jobs in this province.” In a 1976 Canadian Business article, journalist Mark Witten wrote that “the auto industry is Ontario’s largest employer. Directly or indirectly it accounts for one out of six jobs in the province.” In 1978 Ontario NDP leader Michael Cassidy also cited the figure, which had been prominently mentioned in the Ontario government report, Canada’s Share of the North American Auto Industry: An Ontario Perspective. Similarly, a 1979 Saturday Night article noted that “the auto industry is directly or indirectly responsible for one out of every six jobs in Ontario; it’s the one indispensable industry.”
Again, let me remark on how central this sector has been historically and how from the very beginning or from very early on, and definitely in the reckoning of this book, which goes from the 1970s to the 2000s, job connectedness has been key. These jobs have been created over decades, and the supply chain, with its set of professional and training capacities, has been built up over decades as a result.
I'll go back to Mr. Anastakis:
By 1985, Ontario Premier David Peterson was telling reporters that “one in five” people in Ontario were in some way employed by the auto industry. During the 1987 Ontario provincial election and in the midst of the free-trade debate, one of Peterson’s Windsor candidates ran radio ads declaring that “one in six jobs in Ontario depends on the auto industry.” The figure has persisted, even after decades of change....
I'll stop there and skip ahead a bit:
The long-standing use of the one-in-six ratio is important because it reflects, in a very representative way, the central and underlying argument of this book. The sheer number of jobs and the relative importance of the auto industry within the Canadian economy became the driving paradigm that explains Canadian state action in the auto sector. More than any other “fact,” the level of automotive employment, itself a consequence of the level of production and investment in the Canadian sector and the health of the trade balance and the auto pact, pushed politicians, policy makers, and workers to initiate and engage in a host of creative and aggressive policies and actions to ensure that Canada and its workers received what was seen as their fair share of the sector’s bounty. One in six was, and remains, the corollary of the fair-share mantra.
I'll just close the quote there for a moment and try to shine a light on the spirit of the motion, which is condemning the unjustified American tariffs on the Canadian auto sector and, with Monsieur Ste-Marie's amendment addition, that of heavy vehicles.
It is very much focused on real people: people who earned livelihoods and people who had a job that paid the bills and who took care of their families. It was part of not only a local supply chain, but an international market. There was pride of manufacturing and often pride of ownership in those same vehicles. That's the context that makes these unjustified American tariffs sting the way they do. It's this context of an employment construct and a set of cross-border investments.
I find it striking that Mr. Kingston, who was a witness here earlier, represents the CVMA, the Canadian Vehicle Manufacturers' Association. They are American automakers, but such is the pride of ownership in these vehicles, such is the pride in manufacturing these vehicles and such is the extent and the length of the footprint of these companies that they feel in a very real way to be Canadian.
I'll go back to Mr. Anastakis:
But Canadians were not just looking for a fair share—they were looking for even more than that. By the 1980s, Canadian auto factories were producing nearly two million cars a year, while Canadians were buying only three-quarters that many. In other words, Canadians were enjoying a share of automotive production far greater than they “deserved.” More than anything else, this disproportionate production-to-sales ratio demonstrates the success of Canadian policy makers in pushing the fair-share mantra to its limits, especially given that the Canadian market and industry was integrated into that of the world’s largest market and largest car-producing nation, the United States. Indeed, the connectedness of the North American auto industry was both Canada’s greatest strength and its most daunting threat in this period.
I'll just close the quote there. It shows how history echoes in our present time. Clearly, our connectedness is both our greatest strength and our greatest threat in this particular moment.
I'll go back to Mr. Anastakis:
Integration allowed Canadians a certain leeway that was not possible in a solely national market. Whether through investment incentives, regulatory variations, or union break-ups, integration provided Canadians with opportunities that would not normally have appeared within a normal national or non-continentalized industry. At the same time, what were initially threats that emerged because Canada’s industry was continentally integrated, such as the Chrysler crisis or the issue of Japanese investment, became, in time, strengths.
Again, the context is the presence, the footprint, of the sector that is so aptly captured in the initial parts of this motion around negotiating a win to support “the workers whose livelihoods depend on a good deal for Canada”. It is not only the footprint we had over decades but the new footprint we've been able to amass. I'm perhaps just drawing a perspective on Mr. Anastakis's work.
I'll go back to Mr. Anastakis:
All of this hinged upon the integration introduced by the auto pact. The agreement legitimized Canadians' claims for a fair share of the industry and created opportunities for Canadian policy making that were not present in other areas of trade or diplomacy. Achieving that fair share brought out ingenious and sometimes daring public policies and political manoeuvres, such as the Ford incentive, Lumley’s Yokohama Squeeze—
These are items that are referred to earlier in the book.
—or the duty-remission orders, all of which were designed to accrue a greater share of the industry for Canadians. In the short term these measures undoubtedly worked in bringing investment or production to the Canadian sector, and in the long-term they established Canada as a legitimate North American and global force in automotive production, though most of the policies themselves were ultimately dismantled.
Let's close the quote there for a moment.
I've referred to, and we've all referred to, the relative unanimity we have, perhaps, on this committee—and definitely across different governments of different stripes—around support for the sector, support that was, I think, qualified for a moment in the immediate financial crisis when it sounded like the federal government of the day would not be as present for the sector as was needed. However, then saner heads prevailed, and there was a very artful federal, provincial and U.S. federal tripartite engagement in saving many of the plants in Canada.
Mr. Anastakis kind of refers to that, and I'll quote again from the book:
It helped, too, that Canadians could count on a close-knit bureaucracy in Ottawa, a willingness to cooperate with provinces in most instances, and a laser-like focus when it came to negotiating with other states, firms, associations, and especially the United States. Bargaining with a hegemon is a daunting task, yet Canadian politicians and policy makers were extremely capable in this regard. In numerous instances, from the auto pact to the stillborn efforts to prohibit incentives and the free-trade negotiations, Canadian diplomats and civil servants exhibited preparedness, daring, and a willingness to stand dangerously close to the twitching and grunting elephant that was the United States.
Those are his words, not mine.
We'll go back to Mr. Anastakis:
Canadians had to focus in a way that the United States did not, given how high the stakes were for the former. And in most instances, the Canadians proved effective negotiators.
He goes on:
Differing governmental structures also played a role in determining the outcomes of the auto trade, usually in Canada’s favour. The parliamentary system, with its fused executive and legislative, the high level of cooperation between its core agencies, and the closeness between senior bureaucrats and elected officials, made strategy development and tactical execution far less difficult than in Washington. In the American capital, the division of powers, jurisdictional competition, and the sprawling nature of the giant U.S. bureaucracy slowed American responses and hindered aggressive bargaining. Moreover, Canada remained low on Washington’s list of priorities, a position that undoubtedly helped Canadians at some points though it hindered them at others.
I'll share how important I think this historical element is to our current context. We've had to develop a capacity in government, over years and decades and across different political parties, of being able to work to the maximum advantage of the Canadian sector. Even when there's good-natured debate, even if those 445 interventions in the House are not always complementary to any one party or any one government, we have, broadly, a policy alignment in this moment and in decades past around the kinds of things we need to do to support the sector.
That exists in the parliamentary circumstance. It exists between parliamentarians. You can even see it, I think, in the former government's Canada-U.S. trade committee, which was multipartisan and had many ways of reaching out to the American administration of the day to ensure that Canadian best interests were met during the renegotiation of NAFTA at that time.
I think this quote also shows the benefits we have from being perhaps not as much on the Americans' radar with respect to this specific sector as the Americans are in Canada. We know that we're now facing a few of the consequences of the new administration's focus on this sector and of some very specific statements they've made.
Indeed, Mr. Anastakis gets into that in his history as well. Let's get back to his book:
But, eventually, American policy makers saw the immense leeway Canadians exhibited in the auto trade—and particularly under the auto pact—as simply too much. The agreement itself had always been viewed as an intractable problem by elements of the U.S. government, and by the mid-1980s its staunchest American defenders—the auto companies themselves—realized that Canadian auto-policy efforts were in fact benefiting offshore producers to their detriment. When it became a subject for negotiation during the FTA talks, the Big Three saw no reason to further defend the auto agreement beyond maintaining it as a shadow of its former self. Indeed, the success of the auto pact for Canadians in part helps to explain its demise and the subsequent emergence of the free-trade agreement. By the time the idea of free trade was being negotiated, the industry was in its best shape. Most of the investment promises that the Canadian Big Three had made to Herb Gray—
He's a former Windsor MP and minister in the Trudeau government.
—in 1981 were being fulfilled. AMC had committed $8 million to convert its Brampton plant from Jeep production to cars, and eventually in 1984 it announced a new plant worth nearly $800 million in Brampton to build new cars. As promised, Ford’s St Thomas plant was converted at a cost of $73 million to produce EXP and LN7 front-wheel vehicles, Oakville had added a second shift to produce only cars, and the $40 million Essex Aluminum plant had opened, not to mention the booming success of the Essex Engine plant. GM Canada spent $3 billion to upgrade its facilities in Windsor, Oshawa, and St Catharines. By mid-decade, the Japanese were coming on strong, too, with Honda doubling its plant size, Toyota adding to its facility, and GM’s Suzuki plant rounding out the “foreign” transplants operating in Canada to a tune of nearly $1 billion in new investments.
Those investments were in the dollars of the day, so those dollars have now increased in amounts. This paragraph is a very important reminder of how, through change, conflict and intention, including with our chief trading partners, really good things can result. This paragraph very well encapsulates a new series of investments that happened in a moment of real challenge and change for Canada. There was, to some extent, some deindustrialization happening, as there was in many western economies, yet look at all the investments being referred to in this paragraph. They are either still going strong or are the subject of this committee today.
I'll continue with Mr. Anastakis:
The greatest fears of the Canadian industry—that it would be left behind as the Big Three retooled for the next generation of vehicles, and that offshore producers would not establish plants in Canada—had been avoided. The state had played an indispensable role in this achievement. In 1981 the chairman of the federal government’s automotive task force, Campbell Stuart, triumphantly enumerated the different forms of “Government Assistance to the Automotive Industry” to his minister, Herb Gray. The long list included [$200 million in] loan guarantees for Chrysler, a $10-million grant from the Ontario government to Chrysler for an R&D centre, the $68-million federal-provincial grant for the Ford Essex Engine plant, “flexibility” under the auto pact, and two duty-remission programs (the general order and the expanded order) that had provided “a major incentive to foreign vehicle producers to source parts in Canada,” resulting in exports of over $88 million under these programs in 1980. By mid-decade, Canadian policy makers could add to this list voluntary export restraints, port slowdowns, and additional production based on duty-remission orders, all of which had helped convince the Japanese to come to Canada. It was an impressive record, one that reflected an aggressive state interventionism and a willingness to push the limits of public policy. In a 1984 speech Bob White summed up perfectly Canadian state attitudes towards the industry: “The importance of this industry,” he told his union brothers, “meant that we couldn’t simply leave its survival to the dictates of the market.”
That's a really important quote from Bob White. This is not part of the history, but as we know, he was instrumental in the creation of the CAW, which became one of the co-founding unions of Unifor. It was a key auto negotiation in the 1980s, which is actually the subject of a fascinating National Film Board documentary, Final Offer. I recommend it to all members here who want a deepening of their knowledge of the auto sector. Bob White led the exit of Canadian auto workers from the UAW to the CAW. This quote is really important: “The importance of this industry meant that we couldn’t simply leave its survival to the dictates of the market”.
I think in this part of the history, we're seeing the results of policy-making and moves made by governments of different political stripes, which really highlight the importance, as the motion refers to, of “the workers whose livelihoods depend on a good deal for Canada” and how these tariffs are, indeed, unjustified.
I think a number of us experience this, during our own work in our own ridings, with the drives down the 401, the 403 and the QEW, as I mentioned. I'll go back to Mr. Anastakis on the sense of connectedness:
On looking closely at a political map of North America, one is struck by just how prominently southern Ontario juts into the Midwestern U.S. automotive heartland on one side and into one of its greatest regional markets, the northeast, on the other.... Briefly, however, it is important to note that southern Ontario became Canada’s automotive heartland through its good fortune to be located near the burgeoning Midwestern carriage trade (with its southern Ontario counterpart), just across the river in Detroit. Risk, as exhibited by earlier entrepreneurs such as Ford Canada’s Gordon M. McGregor, played a role, as did, of course the protectionist policies of John A. Macdonald, which created Canada’s original branch-plant industry.
He goes on to write:
First, the success of the industry, and the ability of Canadian policy makers to utilize the wide range of approaches they did, was in part a consequence of the concentration of the sector in the great automotive-producing cluster that stretched northeastward from Windsor. Cluster theory has played a prominent role in explaining the success of some regional industries in Canada and beyond, and the Canadian automotive sector has been the focus of a number of these assessments.
I'll pause here to note there's an important crosswalk with our productivity study, which is about where concentrations of industries can exist, where further investment then follows and where workers can be developed. We heard a bit of that with Mr. Meier earlier today.
I'll go back to Mr. Anastakis:
The concentration of automotive assembly and parts production in southwestern Ontario focused policy makers, both at Ottawa and at Queen’s Park, in terms of creating a coherent industrial policy for the region, and certainly in keeping elected officials attuned to the political power that this populous region represented. Yet the influence of the Ontario cluster did not mean that other regions were abandoned when it came to support for automotive industrial development. Federal efforts to stretch the auto sector outward from Ontario, often in the name of regional development, proliferated in the 1970s and 1980s. When Honda announced in 1985 that its Canadian plant would be located in southern Ontario, British Columbia NDP MP Ian Waddell complained that “while we welcome the Honda plant...for Ontario workers, the Minister must appreciate that western Canadians would like some of that, too.” Waddell’s argument was partially inspired by the logic that Toyota already had a wheel plant in British Columbia. Moreover, British Columbia was not far from California, the world’s largest car market, where the GM-Toyota joint venture NUMMI had recently been announced. In response to these demands, IT&C Minister Ed Lumley replied that the nature of the industry, focused as it was on a just-in-time model, called “for suppliers to be within a 75-mile radius of an assembly facility.” In any event, Lumley argued, the federal government had provided “almost one-half of the financial assistance to get that Toyota plant” to locate in British Columbia—while it had given no direct cash for Honda’s Ontario facility.
I'll close the quote there and remind us of the effects and benefits of this sector. Yes, it's for their workers, and yes, it's for the supply chain, but there are also other downstream investments and benefits that I think are alluded to in this paragraph, most notably the opening of trade routes more generally through the Detroit-Windsor crossing, through Buffalo and through the multiple crossings in the southwest and in the Niagara Region. They are very important endowments we have because we have such important trade in a key sector. The trade in that key sector and the trucks that go down Highway 401, Highway 403, the QEW, Highway 420 and other major highways create demand for the kind of transportation infrastructure and connectivity infrastructure that benefits not only the auto sector but a variety of other goods-producing sectors.
When we think about the geographic concentration of this sector in southern Ontario, I think to the commendation of all members of this committee, we are focused on its impact in southern Ontario and we appreciate that, even though it might not benefit our specific ridings as much as other ridings, it has downstream effects that reach beyond those agglomeration economies in the 75-mile radius.
That's a bit of the background from Mr. Anastakis around the concentration here.
Elsewhere in his book, I think he positions the overall thesis as follows. Again, I will quote Mr. Anastakis:
The auto industry is the largest, most complex, most competitive, and most challenging industrial sector in North America. There is an immense amount of information on the automobile and its industry, and the flow is unstoppable: a century of dailies, weeklies, magazines, and reams of raw data from governments and consumer groups, not to mention auto enthusiasts, amateur auto historians, and professional firms whose raison d’être is to analyze the industry. There are whole government departments working on the automotive sector, and the size and scope of the companies involved add a dimension that is not found in most industries. There is also the fact that, although the auto industry is a topic of historical interest, its key entities—the auto and parts-making firms—are ongoing business concerns, some more than a century old, that are not keen to share their corporate knowledge. Nor, sometimes, are governments, given the political and economic sensitivity of the automotive sector. In short, there is an automotive data fog, one complicated by inaccessibility to some of its most important sources of information.
In his book, he says:
It is quite impossible to examine every issue, even within the focused period and themes I have chosen. By necessity, I have left out a number of issues, elements, and actors out of this book. There is, for instance, little discussion of the retail side of the industry, or the aftermarket, not to mention design, financing, advertising, and marketing.... Nor does the book dwell on automobiles themselves, or deal in any way with specialty manufacturers of heavy trucks, city buses, motor homes, or motorcycles. Snowmobiles, which became very popular and an issue in Canada-U.S. trade in the late 1960s and early 1970s, also do not receive attention.
I want to pick out each of those sectors in turn and describe how each of them has a real, important impact on this debate.
For instance, there is the design, financing, advertising and marketing side. We know that this sector creates a number of jobs and has a number of pieces of connectivity to it. There may be the image we have in our minds, and again, I recommend watching the Final Offer movie to see what manufacturing looked like in the GM plant in Oshawa in the 1980s. It looks, I gather, quite different now. You had people using machine tools—mostly men in the factories at the time—doing the assembly work, the upholstery work and a variety of pieces of work.
This sector is historically one of the biggest spenders of advertising dollars in Canada. In fact, one of the key parts of this sector is that it helped to sustain the newspaper industry in the seventies, eighties and nineties with large commercial advertising—whole sections dedicated to automobiles. The Toronto Star had its own auto insurance columnist, who was so dedicated.
There are all kinds of spillovers in the sector. I don't need to remind members of this committee that auto insurance is a mandatory product for purchase in Ontario and, I think, in all provinces. If you have an auto sector, it means you have an auto retail sector, which means you have auto users and have the downstream effects of auto insurance purchasing, of detailing and obviously of mechanics and shops, with a variety of kinds.
I'll give a quick side comment to remind all members of the committee to get their winter tires ready, because they are necessary.
It's a sign of the ongoing demand of the sector that we can have a strong future for all of these different sectors even if the particulars change.
Mr. Anastakis also refers to the retail side. We heard earlier from the Global Automakers of Canada, which is somewhat represented in manufacturing. Also, definitely, the very large footprint of Toyota and Honda in southern Ontario is a very important part of that.
Global Automakers of Canada has a number of members that are not manufacturing currently in Canada but are doing retailing, and we know that the Canadian appetite for vehicles is broad and includes European vehicles, Asian vehicles and a variety of kinds. We also know that, thanks to some of the investments that have been referred to and the history, we are now starting to attract our first European automakers to Canada with the plant in St. Thomas and the associated activities there.
I referred to design, financing, advertising and marketing. Those are what might be typically considered white-collar jobs, jobs with a proud history here, and there are also marketing firms. There are all kinds of communications outfits. There are all kinds of creative professionals who work in the sector and are involved in some of this work.
Mr. Anastakis says, “Nor does the book dwell on automobiles themselves”. We know that automobile culture in Canada is very strong. As you know, Mr. Volpe referred to the vehicle he drives with a certain degree of pride. For me, it's the family vehicle: the Impala with the front bench. Others will have other vehicles that they have a real fondness for. There is a great automotive history, and we have collectors in Ontario and across Canada who take pride of ownership in their work and in the history of their vehicles. That also extends, I think, into other related sectors.
The automobile racing sector, for instance, is one that I think has an unusually large footprint in Canada compared to other places. With my family, I have gone regularly to the Merrittville raceway and have seen the different ways in which people soup up their vehicles. I haven't been there for the school bus race yet, but that is available.
We know that school bus manufacturing has its own unique history in Canada, which is referred to in the quote on the specialty manufacturers of heavy trucks, city buses, motorhomes or motorcycles and snowmobiles. Snowmobile manufacturing is very important to the culture of this country and is one of the founding stories of one of our major companies, Bombardier.
Also, as we've seen specialty manufacturing come and go, we've experienced the stress of that. I think the motion, including the amendment by Monsieur Ste-Marie, is in the spirit of heavy vehicles and particularly what's happening to Paccar. We know that these different elements of the sector are really important.
This motion, which calls on the government to live up to its promise made during the election and condemning the unjustified American tariffs on the sector, is in a spirit where the automobile has a real sense of connection to the real lived experience of Canadians every day.
Mr. Anastakis goes on to say, “Some actors are dealt with only from particular angles. For instance, consumers’ views are taken into account when these have an impact on the politics, policy, and profitability of the sector.” I'll just close the quote there.
I think we've had quite a robust debate already on this committee about the attractiveness of and Canadians' desire to purchase lower-emitting vehicles. There seem to be global market trends in the direction of more electrification, and there may be global market trends, despite Mr. Volpe's choices, that are going slightly against the direction of some of the muscle car trends.
We know, in turn, that consumer views are the result of policy—as referred to in this quote—not only in Canada but in the United States. We know that the California vehicle emissions standards are a real influence on how capital is deployed in Canada and that the unhooking—or the apparent unhooking—from the rest of the United States, and therefore from Canada, that seems to be coming from California emissions standards is going to affect consumer preferences.
Mr. Anastakis goes on to say, “The auto workers’ union is covered extensively, but less so are the workers themselves—time and space make this unavoidable.” I think all of us on this committee and in the House of Commons probably approach the 445 interventions I referred to fundamentally on behalf, first and foremost, of the workers. I have the pleasure of meeting workers in my riding, as I think we all do.
A couple of weeks ago, I had the pleasure of meeting Mitacs, which is an important connector among companies, academic research and learning. One of Mitacs award winners was in fact someone doing work on automotive sector enhancements and innovations, something that benefited companies in southern Ontario. This is someone who wouldn't have necessarily seen himself as an auto sector worker, yet he came out of research and did an innovation that has now been benefiting the sector.
I just want to double down on how important the exit of Canadian auto sector workers from the UAW in the eighties was for driving confidence and inspiration towards an entire union movement in Canada, one that said Canadian union workers could stand proudly themselves and form their own union. Of course, there's no comment or disrespect towards the many Canadian union members who are part of larger internationals. We have a number of those, including some involved in the sector.
I think another important part of our story of sovereignty is that we were able to have the benefit of what is now Unifor coming out of a pretty important Canadian-led negotiation with U.S. auto sector workers. Mr. Anastakis goes on:
Even a few significant manufacturers play only a minor role in the book. As the focus is on the Big Three, who controlled over 90 per cent of the industry until the 1980s, companies like the American Motors Corporation (AMC) and International Harvester, though bona fide manufacturers under the auto pact, are not examined in detail.
As we know, AMC then became part of the big three, retaining their brand Jeep. He continues, “Nor is Hyundai, which was very successful as an importer into Canada in the 1980s and subsequently opened a manufacturing facility in Quebec in 1989.”
We know that Hyundai is an object of interest. It's a growing company with lots of different jurisdictions interested in attracting Hyundai investment. We know that Minister Joly was there recently. We know that they're a very innovative automaker that has a lot of potential and is obviously selling lots of vehicles here in Canada at the moment. On the theme of electrification, I believe that the Kona is a Hyundai vehicle, and they have a very successful, popular plug-in hybrid model.
I'll return to Mr. Anastakis:
Ultimately, this book does not describe some sort of golden age of statism or interventionist utopia, but it does illuminate a period of active and creative policy making in a highly competitive continental and global economic sector. Indeed, it is undoubtedly true that the Canadian state(s) played a central and positive role in creating and sustaining industrial policies in the auto sector that lasted for two decades, policies that brought great prosperity to Canada, and especially to Ontario. And, although the auto industry was centred in Ontario, the sector’s success emanated outwards, and this prosperity was shared by all Canadians through tax revenues, equalization, and employment opportunities. These industrial policies also helped to maintain a cluster of innovation that provided further opportunity in the form of the emerging Canadian-owned parts industry, which generated its own entrepreneurial, research-and-development (R&D), and spin-off opportunities. By the early 2000s, Ontario produced more vehicles than any other jurisdiction in North America including Michigan, and the auto industry today remains its single most important economic driver and the largest value-added Canadian export sector.
Again, those are Mr. Anastakis's words from 2013.
I think it's important to underline the broad, shared prosperity that comes from the sector, one that we're seeing echoes of with the move towards electrification. I know that electrification is a concern of some members of this committee. We've had motions and have had statements in the House and at this committee that have seemed to imply, at least to members on this side, that electrification is not something to be desired or that we should just leave it entirely to others without a recognition of the real benefits that electrification can bring not only in helping to meet our climate objectives, but also in appealing to the tastes of consumers by appealing to the abilities and built-up infrastructure we are now doing in the next generation of auto investments, therefore really being the next export sector that has so much potential.
If anything, the comments from Mr. Anastakis that I've read into the record show that nimble, inventive and aggressive policy-making has always been a feature of the Canadian auto sector and has had quite a bit of bipartisan or federal-provincial co-operation. I think all members of the House wish we could see more of that in other policy areas where there may be greater differences.
The move towards electrification, which I think my colleague Ms. O'Rourke has shared on in past meetings, is more distributed and results in more shared prosperity because of the supply chain and because the benefits that come from this work stretch out more broadly. We can have electrification, including electric subsidiaries provided by major oil and gas-related companies like Parkland. Parkland has an electrification subsidiary, which, we understand, employs about 250 people and is bringing electric vehicle infrastructure to different parts of Canada.
Electrification obviously also involves a broader set of inputs with the battery components and critical minerals, something that our government has been very focused on with the critical minerals strategy. There's a real focus on the sovereignty of critical minerals, making sure that we are doing deals with other countries and that, through initiatives like our Major Projects Office, critical minerals can indeed be brought out and into the manufacturing supply chain for auto. Then, as the motion says, we can live up to the promise made during the election to honour “the workers whose livelihoods depend on a good deal for Canada” and can condemn the unjustified American tariffs on the auto sector.
Those are just a couple of the benefits of electrification.
I think broader shared prosperity comes from this policy move. Mr. Anastakis's context and the history that he's provided really help us see that we have to be constantly innovating on policy to ensure that we continue to get the benefits of this fast-moving sector, one with substantial capital buildup.
Mr. Anastakis, though, isn't just a historian. He's been writing more recently as well. I want to quote from a Globe and Mail op-ed that he wrote before the election but after the U.S. announcements on tariffs in March and April. He writes:
It’s often said that this or that particular moment represents a paradigm shift in history. In the 1910s, Henry Ford ushered in the second industrial revolution of mass production and consumption with his use of the moving assembly line, new production techniques, vertical and horizontal integration, and economies of scale. The result was “Fordism” and all of its immense consequences; as Ford arrogantly put it, “I invented the modern age.”
From the 1960s to the 1980s, Eiji Toyoda’s Toyota Production System, or TPS, improved upon Fordism by utilizing just-in-time, continuous self-improvement, and lean production techniques. Combined with new labour approaches and advancing computerization, the auto industry—and much of society—was reshaped once again.
Since the 2000s, we are in the midst of another pivotal shift: Industry 4.0, the fourth industrial revolution, is the embrace of robotics and advanced production processes, digitization, computerization, AI, and new materials and propulsion systems. But the electric vehicle (EV) revolution is not just a technological leap forward that represents the future of the auto sector and mobility, it is a strategic imperative in the competition with China, and an essential part of the response to the challenge of climate change.
I really appreciate the comments from Mr. Anastakis in this op-ed, because again, he contextualizes some of the things the government is doing. This shows how important it is—as we agree, in the motion—to condemn the unjustified American tariffs on the sector to support “the workers whose livelihoods depend on a good deal for Canada”, but it really goes to show what broader shared prosperity can look like. In fact, it's something this committee will be looking at in the future in its forthcoming study on artificial intelligence. In the spirit of this motion, I would commend to this committee the value of having some specific witnesses who can speak to the role of AI and computerization in the auto sector.
You occasionally hear that some concerning things are happening in the in-vehicle experience with AI chatbots, but we know that the broader role of AI computerization and digitization, which are already here, is going to be of potential benefit to Canada. Again, I'm contextualizing the auto sector beyond just the people on the factory floor, who are very important and anchor this work. I'm reaching beyond them towards the innovators who are creating new companies and new technologies; the people in the mines and the mining companies extracting the critical minerals we need for this sector; and the builders that are building the new plants that we're seeing built. One in Windsor is already built. Two are being built in and around St. Thomas.
In the broader context of the investments we see in the sector, with government policy-makers at the fore, with some fair degree of agreement across partisan lines, with very strong alignment between levels of government and with these different technologies...are very important features of the Canadian auto sector that are being referred to in this motion.
I think it's really important that the electrification we're moving towards, which all of the world is going to.... The question is at what pace and with what policy support. We have the strong view that the policy supports we have put in place to support some of the manufacturing and the critical minerals strategy, in particular, will have a much broader impact on and benefit for our constituents in every part of Canada. To really see that connectivity as important would also be in the spirit of the motion.
I know this motion does not refer to electrification, but it is a fact that electrification is a key feature of our automotive present and future, whether it's in consumer trends, the plants that are currently operating in Windsor and soon to operate in St. Thomas, or some of the lines we are trying to attract elsewhere. Really lifting that up and celebrating it is an important part of this.
Mr. Anastakis's history shares very compellingly that the continual evolution of policy-making in response to new threats, whether new trade threats, new technological threats or new threats of investment being withdrawn or not withdrawn, has been key to having a vibrant sector. Yes, we can and we should condemn the unjustified American tariffs on the Canadian auto sector, but we should also do the very important work in Parliament to pass the budget and do the very important work in Parliament to have debates on these issues, as I've referred to with the 445 interventions—
