Public Safety Committee on April 15th, 2024

[The Chair, Liberal, Heath MacDonald]

Ms. O'Connell.

[Jennifer O'Connell, Liberal, Pickering—Uxbridge, ON]

It would still be reported to the House that this is the opinion of the committee. If Conservatives don't want a response, they don't have to read it, but I think it's important, if the committee sends an opinion to the House, that the government respond. Why would you not want that?

In terms of how many days, that's a maximum. I think to not support having a response doesn't do anything to undermine it and it would still present to the House and to the government this committee's support for this motion.

I think Conservatives are just playing games with that and that's unfortunate. I think it's clear that we support this. It's this committee's opinion to the House and we ask for a comprehensive response.

[The Chair, Liberal, Heath MacDonald]

Thank you.

Mr. MacGregor, just to be clear, we have an amendment to the motion over here. You're good with that.

Do you want to just follow through on what you discussed the last time, just to be clear so everybody understands it, including myself?

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Certainly. I think that—

[Chris Bittle, Liberal, St. Catharines, ON]

I have a point of order.

I think someone's taking a photo in the back.

[A voice]

I thought you were going to say someone was taking a cookie.

[Chris Bittle, Liberal, St. Catharines, ON]

That would be upsetting as well, but I think someone's taking a photo. If that could be deleted from their phone....

[The Chair, Liberal, Heath MacDonald]

That's good.

Witnesses, you likely aren't very interested in what we're discussing at the moment, so you can depart.

Thank you so much for your testimony.

Go ahead, Mr. MacGregor.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Thank you, Chair.

It's technical amendments to the wording. The first part—“that in the opinion of the committee”—I think is valid.

Honestly, I didn't want us to take that long, but I think, to Mr. Lloyd's point, that's a regular standing order, so I think it is up to 45 days. I'm not sure we can do anything about that. That's kind of a standard standing order.

I'm prepared to accept it with the amendments, just as long as we get you to formally report it to the House, Mr. Chair.

Thank you.

[The Chair, Liberal, Heath MacDonald]

The would be a subamendment to the amendment. Is that your understanding?

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Yes. With Ms. O'Connell's interjection referencing that standing order, my subamendment to the amendment would be—and perhaps the clerk can find a way to say this—“That the chair report this to this House, and that, pursuant to Standing Order 109”. That would be my subamendment.

[The Chair, Liberal, Heath MacDonald]

Mr. Lloyd, go ahead, please.

[Dane Lloyd, Conservative, Sturgeon River—Parkland, AB]

Thank you.

I'm very glad Mr. MacGregor brought up that very important point, because that is a subamendment that we could strongly support. We do want to see the chair report this important issue to the House. We do want to see a comprehensive report from the government. Hopefully it won't take 120 days, because I know there are stakeholder groups that have been calling on the government to implement this change since at least 2019. It's been five years and there have been some of the worst forest fires in Canadian history—if not the worst in Canadian history—and we still haven't had action from this government on this issue.

I am strongly in support of this motion and this subamendment. Hopefully we can get this dealt with quickly.

[The Chair, Liberal, Heath MacDonald]

We're going to move on. I'm going to call for a vote on the subamendment.

(Subamendment agreed to)

(Amendment agreed to)

(Motion as amended agreed to [See Minutes of Proceedings])

We're going to suspend until we get our next witnesses in place.

[The Chair, Liberal, Heath MacDonald]

I will reconvene the meeting.

I would like to welcome our second panel of witnesses. In person, from the Canadian Vehicle Manufacturers' Association, we have Brian Kingston, president and chief executive officer; and by video conference, we have the Automotive Parts Manufacturers' Association, Flavio Volpe, president.

Up to five minutes will be given for opening remarks, after which we will proceed with rounds of questions.

Welcome to all.

I now invite Mr. Kingston, please, to make an opening statement.

[Brian Kingston, President and Chief Executive Officer, Canadian Vehicle Manufacturers' Association]

Thank you, Chair and committee members.

Thank you for the opportunity to be here this evening and to participate in your study on car theft in Canada.

Auto manufacturers are deeply concerned about the rise of car theft in Canada. The industry is actively working with stakeholders, including the federal government, provincial and municipal governments, insurance and law enforcement to understand the challenges and find solutions to deter vehicle theft.

Manufacturers are continually innovating and improving anti-theft measures to strengthen vehicle security for their customers. Vehicle theft deterrence and security system enhancements that are under development or deployed include passive ignition immobilization, active warnings in the event of an unauthorized vehicle entry, dashcams with surveillance modes, parts marking, hidden VIN markings, stolen vehicle location services, software updates, supplemental unlock code entry in the radio and software lockdowns to prevent programming of extra key fobs, just to name a few.

Manufacturers alone cannot reduce auto thefts rates in Canada. Effective solutions to this crisis depend on correctly diagnosing the source of the problem.

Vehicle theft rates have grown much faster in Canada than in the United States since 2021. This is despite stronger regulatory requirements for Canadian vehicles in the form of the mandatory engine immobilizers and fitting of the same technologies in new vehicles in both countries.

The question is: What explains this divergence in theft rates if we have more secure vehicles in Canada by default? The answer is concerning. Sophisticated, transnational, organized crime groups have targeted Canada, where the risk of prosecution is low and the financial reward is high. To successfully combat vehicle theft, we need a comprehensive plan to target organized crime groups and close the export market for stolen vehicles. Such a plan should include the following action items.

Number one is funding for law enforcement. Law enforcement agencies require more resources to tackle vehicle theft like the auto task force that we just heard about. A dedicated auto theft reporting mechanism for the public would facilitate coordinated and expedited enforcement action. Expanded authorities for local law enforcement to access intermodal facilities based on stolen vehicle intelligence would also help stem the movement of stolen vehicles domestically.

Number two is Criminal Code changes. The profits generated through auto theft grossly outweigh the risk of capture, prosecution and sentencing for organized criminals. The Criminal Code needs to be strengthened so that there are real consequences for vehicle thieves.

Number three is resources for the Canada Border Services Agency. Investments into personnel, container imaging machines and remote VIN verification technologies would help stem the flow of stolen vehicle exports. The recent recovery of 598 stolen vehicles at the Port of Montreal underscores the vulnerabilities at our ports.

Number four is policy coordination. Auto manufacturers are being asked to increase vehicle security while simultaneously being regulated by right to repair legislation, including at the federal level, to provide full access to the data stored and transmitted by vehicles beyond what is needed for repair. This works directly against the efforts of auto manufacturers to keep vehicle systems secure.

Finally, no solution is complete without ongoing collaboration between manufacturers, government and law enforcement agencies. We are committed to continued engagement.

We thank you for the opportunity to be here today and present our recommendations, and we look forward to any questions.

Thank you.

[The Chair, Liberal, Heath MacDonald]

Thank you, Mr. Kingston.

Mr. Volpe, please go ahead.

[Flavio Volpe, President, Automotive Parts Manufacturers' Association]

Thank you to the committee members and chair for having us today to speak to this crisis and give our perspective as technology suppliers.

The APMA represents hundreds of suppliers to original equipment manufacturers of vehicles in Canada and around the world. That's hardware and software, some of which is used in vehicle security.

Some of those advanced technologies Mr. Kingston articulated are in high demand among automakers sourcing them in Canada. The industry in Canada ships $35 billion worth of parts and systems a year, and we're a major international player. The industry suppliers, whether hard or soft, bid every car with the best technology available in the year of supply—meaning that, when Mr. Kingston's members are looking for the best cybersecurity, immobilizers and hardware to help with the security of vehicles, Canadian companies are well placed to do this and vend into that process every single year. The process is usually this: An automaker looks for specific engineering specs, and companies bid on them.

Advanced companies in this country came together to build Project Arrow—an all-Canadian vehicle prototype sourced and built entirely in Canada. On that vehicle, we demonstrated a series of technologies. A company called Myant out of Toronto did textile computing in the steering wheel and seats, which helps track the vitals and biometrics of drivers and passengers. Companies like Cybeats are on the leading edge of cybersecurity in software and building materials on the vehicle. When a vehicle is stolen, those types of technologies come into play for the owner, the company that assembled that vehicle and law enforcement.

We bid, from Canada, the best tech to assembly around the world, but we're mostly focused on North America. As you might expect, the competitive advantage when you own unique IP is that none of it is ever open source. You're not out advertising how that security technology works, because, for it to work, you also need to be discreet about it.

I'll close with a personal story that helps articulate where we are here.

I've had two vehicles stolen from me. One was in 1998 in a purely analogue world. The car was presumably hot-wired and taken off a lot, and that was the end of that. The insurance paid me out. I worked with the local police service to get the reporting to the insurance.

Very recently, in 2024, I had another vehicle stolen and the process was a bit different. This vehicle was plated in Ontario but stolen from a storage facility in the U.S. The thieves broke into the facility to get the keys. When law enforcement responded, their priority was the break-in. The vehicle was secondary, although we got to the vehicle in the reports within a day. I reported to the insurance company. Then I reported to the Ministry of Transportation in Ontario that a vehicle with Ontario plates was stolen. Then I worked with the automaker, which has its own GPS tracking, in order to give permission to the police to track the vehicle. It's two to three days for that process. By that point....

This is the only product that can get itself away from the scene of the crime in a unique fashion. It's very difficult to figure out where the vehicle is, especially if thieves are just as technically inclined as the companies that assembled it and immobilized those pieces.

It is a crisis, and we all own a part of it. I've spoken many times on this. Canadian technology suppliers and automotive suppliers are ready, willing and very actively demonstrating this technology and selling it to automakers around the world.

For us, the key is to create the environment and the funding for law enforcement to tackle this global issue. Ours is a small window of what's happening around the world in organized criminal activity in a very lucrative market. The product is gone rather quickly, and even the most earnest law enforcement and coordination amongst the industry takes a day or two or three.

Thank you.

[The Chair, Liberal, Heath MacDonald]

Thank you, Mr. Volpe. You're right on time.

Mr. Kurek, you have six minutes please.

[Damien Kurek, Conservative, Battle River—Crowfoot, AB]

Thank you very much to our witnesses.

I think it's a valuable conversation to have here. We had law enforcement in the first hour, and now we have some of those involved in the manufacturing process.

What I've heard from the government side is that auto manufacturers—and I would suggest that probably applies to auto parts manufacturers and those who are working to develop the technology—are not doing enough, that it mostly falls on the responsibility of the manufacturers.

In your testimony and introduction, you both stated how seriously you take this issue.

I'll start with Mr. Kingston and then go to Mr. Volpe. Could quantify for us what the members of your organizations are investing to help address this issue and then maybe tell us some of the targets you're looking at in terms of forecasting to see this very serious issue addressed?

[Brian Kingston]

Thank you.

I can't give you an actual figure as to what company investments look like. It's on an individual company basis in terms of what they spend and that would not be made public or available to me. What I can tell you is that I just listed off a handful of measures that manufacturers have put into vehicles. That's just an example of the investments and initiatives that are undertaken by manufacturers to try and stay one step ahead of organized crime groups.

We provided information to Transport Canada earlier this year that outlined in a very comprehensive fashion all of the measures and security features that are in vehicles. It's a constant evolution to try to stem the flow of vehicle theft. I think what we're seeing here is this divergence between theft rates in Canada compared to the U.S. It shows that we have a Canada-specific problem with respect to crime and the ability to move these vehicles out—we have more secure vehicles in this country, yet they are being stolen more frequently.

[Damien Kurek, Conservative, Battle River—Crowfoot, AB]

Mr. Kingston, it was alleged at an earlier meeting that manufacturers aren't hurt by the fact that when a vehicle is stolen, the person has to buy another vehicle. I'm wondering what you would say to that sort of suggestion.

Then, Mr. Volpe, I'm hoping you can answer the larger question here.

[Brian Kingston]

That's frankly preposterous. Manufacturers have a relationship with their customer through the dealership. They build that relationship over years. The last thing they want to have happen is to have a customer have their vehicle stolen and then they question the vehicle and the technology in it. That is absolutely not the case. A manufacturer wants their customer to feel safe and secure and to continue to come back to that manufacturer year after year when they need a new vehicle. They're investing heavily in this and need this crisis to end.

[Damien Kurek, Conservative, Battle River—Crowfoot, AB]

Thanks.

Mr. Volpe, I hope you can keep it to about 60 seconds, because I have a couple of questions I hope to get in.

[Flavio Volpe]

You don't know me very well, but I'll give it a shot.

The members of the APMA, the suppliers in this country, are trying to demonstrate that they are specifically capable of supplying cybersecurity, AI and machine learning, new tools to the auto sector. We did a demonstration project called Project Arrow. Project Arrow 2.0 is going to do a fleet demonstrating this technology.

Some of the capability of that technology is going to be restricted by things like privacy laws in this country. What the tech can do versus what a consumer might want to allow it to do or what a government might want a fleet of vehicles to do is where the rubber hits the road.