Mr. Speaker, I am pleased today to have the opportunity to respond to the hon. member for Davenport's question about the government's support of our vital auto sector.
The hon. member would have us believe that Canada's auto sector is in serious decline, but I would suggest that the member for Davenport ought to first check his facts.
In fact, in 2006 Ontario outproduced Michigan for the third year in a row as the highest automotive producing region in North America.
Our government is firmly committed to Canada's auto sector and is taking action to ensure it remains strong. We have honoured previous commitments for new automotive assembly investments and we are helping to strengthen Canada's auto parts sector.
In recent weeks, the government announced a repayable investment in a major research project by Linamar Corporation, which is in the midst of a billion dollar expansion of its auto parts operations in Ontario. In December 2006, we also made a $6 million repayable investment in a $20 million R and D project by Valiant Corporation of Windsor, Ontario, to develop state of the art manufacturing systems.
That same month we also announced a $1.7 million repayable investment in an R and D project that will generate environmental benefits for Canadians. This $5.8 million project will be undertaken by Camoplast Inc., based in Sherbrooke, Quebec, and will reduce atmospheric emissions, decrease energy consumption and waste, and increase productivity by introducing a more efficient way to manufacture composite parts for vehicles.
Canada's auto sector continues to attract billions of dollars of new investment each year. Even during this period of global restructuring for North American automakers, Canadian assemblers are winning new product mandates.
The new Chevy Camaro by GM will be built in my constituency of Oshawa. The Dodge Challenger will be built in DaimlerChrysler's plant in Brampton. In Oakville, Ford is building two new successful crossover vehicles, the Ford Edge and the Lincoln MKX. These are votes of confidence in our people and in our auto industry.
The role of the federal government is to create the right economic conditions to support a strong manufacturing base in Canada, and that is exactly what we are doing. In budget 2007 this government introduced significantly enhanced writeoffs for capital investments in machinery and equipment. Automakers will be eligible for a temporary 50% straight line writeoff, while the capital allowance rate on buildings used for manufacturing or processing will increase from 4% to 10%.
These measures, that had been advocated by the Canadian Automotive Partnership Council to stimulate new automotive investment and that were not done in 13 years under the member's government, help ensure the Canadian automotive industry remains sustainable, innovative and competitive.
Our government will continue to work with automakers to attract new auto investment and new product mandates. Already, our measures from budget 2006 to reduce corporate and personal taxes make Canada an even better place for auto investment. They also help make vehicles built in Canada more affordable for Canadians.
Our economic plan, “Advantage Canada”, is creating a better business environment for all industries. “Advantage Canada” will set the conditions for a more productive and competitive business environment, which will benefit all sectors of the economy. This plan will continue to lower taxes, reduce unnecessary regulation, bring modern infrastructure we need for trade and commerce, and create the highest skilled workforce in the world.
The initiatives this government is putting in place will benefit not only the Canadian auto industry, but all industries, workers and consumers.