International Trade Committee on June 9th, 2026

[Gabriel Ste-Marie, Bloc, Joliette—Manawan, QC]

To what extent are the companies you represent integrated into assembly plants in Canada, the United States and Mexico?

[Brendan Sweeney]

I'm sorry, but could you repeat the question?

They are integrated, and particularly with the United States—

[Gabriel Ste-Marie, Bloc, Joliette—Manawan, QC]

What role does Mexico's integration play in your vehicle assembly and manufacturing operations?

[Brendan Sweeney]

It plays a major role. When I think about our members, substantial componentry, particularly propulsion systems, whether they are engines, transmissions or batteries, come from the United States. PMAC members are major customers of automotive parts produced in the United States. That's how they've organized supply chains. They did it in a way that we can be so competitive in Canada. At least, we were before the tariffs and hopefully will be after the tariffs. Without those levels of integration, we don't know if we will achieve those levels of efficiency, productivity and competitiveness.

[Gabriel Ste-Marie, Bloc, Joliette—Manawan, QC]

Thank you very much.

So, getting a new trade agreement is important. Furthermore, the U.S. government needs to obey the law and stop imposing tariffs in defiance of the current trade agreement, which says there shouldn't be any.

Can you elaborate on this and on the importance of having an agreement that includes not only Canada and the United States, but also Mexico?

[Brendan Sweeney]

Removing section 232 tariffs is vital to the competitiveness of this industry and, frankly, to the automotive industry in the United States, too. It would make sense to do that to improve everybody's competitiveness, especially as we have more engagement globally by companies that are non-market actors that are heavily state-subsidized. The best way to do that is to do it as an integrated North American industry.

For PMAC members, that's primarily integration with Canadian parts and components and U.S. parts and components to a lesser degree. For PMAC members in Canada, concerning Mexican parts and components, there is still some important parts componentry coming into Canada from Mexico, just less than there is coming from Canada or coming from the United States. That has a lot to do with proximity.

[Gabriel Ste-Marie, Bloc, Joliette—Manawan, QC]

Thank you, that's very clear.

I have just under a minute.

Canada has critical, rare and strategic minerals. How can that be a major advantage for the companies you represent, for transportation electrification and for North American factories?

[Brendan Sweeney]

I'm not as familiar with mining as I am with vehicle assembly, but there is a lot of opportunity there. They're not our members, but it's very public that there are a couple of large Japanese companies that are exploring partnerships with some very exciting and reputable Canadian companies to source critical minerals.

My sense is that might be a bit of a medium-term or longer-term play, considering how long it takes to bring mines online. It would be opportunities that we would welcome exploring down the road as we continue to manufacture vehicles in Canada and as a majority of those vehicles are electrified and require a larger battery, such as a hybrid vehicle does.

[Gabriel Ste-Marie, Bloc, Joliette—Manawan, QC]

Thank you very much.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

It's 1:12. We could do two minutes for Mr. McKenzie and two minutes for Mr. Fonseca, if the committee is okay with that.

[Some hon. members]

Agreed.

[The Chair, Liberal, Judy Sgro]

All right.

You have two minutes, Mr. McKenzie.

[David McKenzie, Conservative, Calgary Signal Hill, AB]

Thank you very much, Madam Chair.

Mr. Kennedy, I'm wondering if you believe that Japan would be a marketplace for additional exports of Canadian crude oil from our west coast.

[Trevor Kennedy]

At the moment, unfortunately, no. To my understanding, the refineries in the country are not equipped to use Canadian oil, the heavy oil that we produce, but that doesn't mean the door is closed. I do think there's certainly an interest. This conflict in the Middle East and the disruption it's causing in Japan's oil supply chain—about 90% of its crude oil comes from the Middle East—is forcing the government and the private sector to look at new options. Whether that leads to changes to the refineries and the capacity to bring on...I certainly think the interest is there, and it would help to have further capacity to supply the market and other markets in Asia.

[David McKenzie, Conservative, Calgary Signal Hill, AB]

One option may be for further refining to take place in Canada before a product is exported to Japan that would be capable of going directly into its existing refinery network. An alternative would be to add front-end coking or cracking in Japan. Either of those could allow a supply to Japan from western Canada.

[Trevor Kennedy]

It's certainly worth a conversation with the government and the private sector.

[David McKenzie, Conservative, Calgary Signal Hill, AB]

You noted AltaGas and indicated something that I echo as well: that it's an outstanding Canadian company that is very quietly, perhaps in the Canadian way, perhaps in the Japanese way, just getting things done. I know there's a new facility to come online, shipping out of Prince Rupert, if I'm correct.

[Trevor Kennedy]

That's my understanding. It will hopefully lead to further exports to Japan and other markets. It's a great opportunity for Canada.

[David McKenzie, Conservative, Calgary Signal Hill, AB]

That liquefied petroleum gas is butane and propane.

[Trevor Kennedy]

That's my understanding.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Mr. McKenzie.

Mr. Fonseca.

[Peter Fonseca, Liberal, Mississauga East—Cooksville, ON]

Thank you, Madam Chair.

Thank you to our three witnesses for their advocacy for our business relations between Canada and Japan. It gives me the opportunity to highlight the great city of Mississauga. I represent a riding in Mississauga. Of the 250 largest Japanese companies here in Canada, over 100 are located in Mississauga. Why is that? It's because of the trust that was built between the city and Japan. We have a sister city, Kariya, Japan.

In listening to the witnesses, Madam Chair, what I heard about was trust, partnership and the ability to rely on a trusted partner. With the CPTPP as a foundation, Prime Minister Carney and Prime Minister Takaichi recently launched the Canada-Japan comprehensive strategic partnership. Within that partnership, now building on the CPTPP, where do you see the opportunities? Where do they lie in terms of our economic growth and also in terms of foreign direct investment like we've seen in the auto sector and other sectors by Japan?

I'll go to Mr. Kennedy, please, to shed some light on that.

[Trevor Kennedy]

Frankly, there are many areas of opportunity, but two really stand out in terms of mutual interest. One is the energy sector. Really, this covers all varieties of energy. There's a tremendous opportunity to collaborate. Some of that work is already taking place. Second, the brand new opportunity for Canada is in the defence space, and I know there'll be some focus on this on the upcoming team Canada mission. I think there's a real alignment between Canada and Japan around what we're trying to do domestically to build capacities and look for new partnerships. There's a tremendous opportunity to form those relationships and to see how we're working with others in aerospace, shipbuilding, cybersecurity, and so on and so forth. It's a really exciting area for growth, and it's hopefully an area where we can find ways to build new economic partnerships.

[Peter Fonseca, Liberal, Mississauga East—Cooksville, ON]

Thank you.

I'll say thank you to Mr. Sweeney for the manufacturing. We do recognize just how important the Japanese manufacturers are, especially here in Ontario. It was the Ontario Liberal government that actually brought in Toyota and Honda and developed those industries in partnership with Japan, so that now 77% of vehicles that are manufactured in the province of Ontario are actually Japanese vehicles. They do a magnificent job. Why has that growth been there? It's because of the efficiency of those plants, the productivity and the workers who are there.

Thank you very much for never having laid off a worker in all of these decades of manufacturing in Ontario. We thank you for that. We'll be at the table advocating to have a stronger auto sector here in Canada, of course, with our partners, the United States and Mexico, through CUSMA. Thank you for that.

Mr. White, with regard to canola, where do you see the value added? Where is there still an opportunity? I understand that the population may be going down in Japan, but where are there value-added opportunities with regard to canola within Japan?

[Rick White]

They're stable. They're there. That's very, very important. However, we need to augment our port infrastructure, our railways and our labour. Service is a top priority, and that's one of our important customers. We need to keep them happy. They notice when we don't deliver on time. We need to be a reliable supplier.