Evidence of meeting #115 for International Trade in the 44th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was china.
A recording is available from Parliament.
President and Chief Executive Officer, Canadian Vehicle Manufacturers' Association
No, they do not.
They are using emissions standards. They are tightening those emissions standards. Then it's up to the automotive industry to achieve those through a range of technologies. They are not mandating a ratio of EV sales.
Conservative
Ryan Williams Conservative Bay of Quinte, ON
They have a goal. Is that correct? Is a goal a mandate?
President and Chief Executive Officer, Canadian Vehicle Manufacturers' Association
No.
Conservative
Ryan Williams Conservative Bay of Quinte, ON
We heard they have a goal.
Certainly, we talk about an integrated auto industry wherein almost every job in Canada is dependent on the Americans. If we go forward with the mandate.... I'm going to take one example. We had one manufacturer we heard from the other day—one of yours, I believe. It is a Ford facility that is switching away from EV to gas-powered vehicles.
Why are they switching to gas-powered vehicles, away from EV?
President and Chief Executive Officer, Canadian Vehicle Manufacturers' Association
You have to build what the market demands. That's fundamental. If consumers are demanding certain types of gas-powered vehicles, manufacturers have to build those vehicles to satisfy them and remain profitable.
Conservative
Ryan Williams Conservative Bay of Quinte, ON
Is part of that because of the cost of them, as well? Is it the fact that we don't have an integrated supply chain and don't produce or mine the critical minerals needed? Is that correct?
President and Chief Executive Officer, Canadian Vehicle Manufacturers' Association
That's part of it.
We don't have price parity between gas-powered vehicles and electric vehicles, particularly in North America, where people love and drive pickup trucks, trucks and SUVs. They require larger batteries. A larger battery is much more expensive. We are not at price parity. As a result, it's a challenge for consumer demand.
Conservative
Ryan Williams Conservative Bay of Quinte, ON
I'm the shadow critic for competition, as well. We talk about competition in grocery, airlines and cellphones.
Tell us why the Chinese industry would not be in fair competition with the Canadian or North American automotive industry.
President and Chief Executive Officer, Canadian Vehicle Manufacturers' Association
Simply put, it's because they subsidize their industry to levels that would be unheard of in any OECD country or western democracy. I mean, the estimates are to the tune of anywhere from five to nine times as much as the types of subsidies you see in the U.S. or Canada. That's what drives the prices as low as they are.
Conservative
Ryan Williams Conservative Bay of Quinte, ON
We believe in real competition, but it has to be fair. This is unfair competition.
Is that correct?
President and Chief Executive Officer, Canadian Vehicle Manufacturers' Association
That's correct. North American manufacturers can compete with anybody, but we need a level playing field.
Conservative
Ryan Williams Conservative Bay of Quinte, ON
To get down to the nitty-gritty of this, we can look at trade relationships with the Americans. We already have some strained parts of that trade relationship.
If we continue with the mandate, does it threaten those jobs in Canada?
President and Chief Executive Officer, Canadian Vehicle Manufacturers' Association
It absolutely does. The most recent estimates from IHS suggest that the mandate will shrink the Canadian new-vehicle market by up to 20% by 2035. There's a new paper out from the University of Guelph that is basically a partial equivalence analysis of the mandate. If EV technology does not drop and get to price parity by 2030, they're forecasting the destruction of the automotive industry. That's what the mandate will do.
You cannot force a technology that consumers aren't ready for.
Conservative
Ryan Williams Conservative Bay of Quinte, ON
Can you submit that report to the committee, so we have a copy of it?
President and Chief Executive Officer, Canadian Vehicle Manufacturers' Association
I'd be happy to.
Conservative
Ryan Williams Conservative Bay of Quinte, ON
Thank you, sir.
Mr. Burton, you talked about the problem with data in Chinese vehicles—surveillance devices on wheels. We banned Huawei and TikTok, at least from federal phones and among MPs, because of those concerns.
Why is the Canadian government waiting so long to ban these vehicles, if we have concerns about data?
Senior Fellow, Sinopsis, As an Individual
I don't know.
The Americans have some pretty good information about these concerns, which I'm sure they have conveyed to our intelligence services and collaborated with us on. However, we have an issue in our country with advice being given by CSIS and other agencies such as CSE: It is going to the centre of our government but doesn't seem to be responded to.
Liberal
Conservative
Ryan Williams Conservative Bay of Quinte, ON
Do you recommend that we ban these vehicles based on that concern of the data? Yes or no?
September 18th, 2024 / 6:10 p.m.
Liberal
Mona Fortier Liberal Ottawa—Vanier, ON
Thank you, Madam Chair.
Thank you to all the witnesses for being here today.
Ms. Cobden, I want to drill down on an issue you raised earlier. Perhaps Mr. Desmarais would like to comment as well. It's the whole issue of the price on pollution, the price on carbon. We know it's important to make a transition to decarbonization in order to go green. However, I understand that there are market pressures.
I would like to compare the situation in Ontario with the one in Quebec. Are there any measures that should be favoured? I'm thinking about how the federal government reinvests in Ontario. That's important. I think it gives you the means to make this transition. However, in Quebec, we know that another system exists.
What measures do you favour that we can draw on to continue focusing on the transition?
President and Chief Executive Officer, Canadian Steel Producers Association
I have to make sure I got all that.
Unfortunately, it's very difficult for me to hear the French, so I will make sure that I've understood you perfectly.
President and Chief Executive Officer, Canadian Steel Producers Association
There are differences in the practice as well.
[Inaudible—Editor] structure of the carbon pricing regime is that the federal system is the backstop, and then each province in Quebec and Ontario and elsewhere has its own regime.
Our experience is stronger with the Ontario system, where we do encourage the province to maximize flexibilities under the OBPS. However, there is always the concern that the federal backstop will be triggered, so it is a challenge to do so.
If I understood your question correctly, you're asking where we have some lessons learned. I would say our strongest lesson learned is in the opportunities to see real decarbonization efforts through programs like the IRA. Canada has adopted some components of the IRA but not to a level that we would benefit to the same degree that they are benefiting. Then, of course, we have the overlay of a carbon pricing regime that, as I've mentioned, does affect the steel industry, given our vulnerabilities. We are working to try to minimize that effect and hope to achieve that. Essentially, though, that would be the difference between what's going on. On the IRA program, I think there's lots of information about it, but we would be happy to provide more detail.
