Mr. Speaker, I will be splitting my time with the member for Oshawa.
What we have witnessed over the last decade of Liberal governance of this country is the decimation of the Canadian auto industry. There is no other word that appropriately describes the decline that the Liberals have allowed to happen to our once proud auto sector.
Look at where we were under the last year of a Conservative government, when Canadian auto companies manufactured two million vehicles per year. Fast-forward to the last year on record, which is 2024, and that number has declined by almost 50%. We now manufacture 1.2 million vehicles per year. That is the Liberal government's record in terms of managing the Canadian auto sector.
I cannot stress enough how important, how critical, the auto sector is to the Canadian economy. Number one, auto manufacturing in and of itself is a $17-billion contribution to Canada's GDP. When we look at the ecosystem, which includes the parts and tool and die, it is $94 billion. That is how important it is. There is also the advanced manufacturing we get with auto. If we did not have an auto sector, Canada would lose the critical advanced manufacturing that is important for things like defence production and other things.
The managed decline that the Liberals have allowed to happen to the auto sector is completely unacceptable. They announced, to great fanfare, their new auto strategy, which I think is actually managed decline. I say “managed decline” because there is nothing in their auto strategy that talks about how we get from 1.2 million vehicles per year, the decimation they allowed to happen in the sector, back up to the two million vehicles a year we manufactured in 2015. They have no plan for that.
What they do have are some maybe clever-sounding sound bites. I think the industry minister said we are going to manufacture the future electric vehicles that the world wants. She said something like that. Let us break that down for a second.
Number one, over 95% of the vehicles we produce in Canada get exported to the United States. Number two, where would these vehicles go, these mythical Canadian-manufactured EVs that the industry minister talks about? Would they go to Europe? More cars were stolen in Canada last year, including two of the Minister of Justice's vehicles, than were exported to Europe last year. Let us put that into perspective. It is a fantasy. There are no other markets on the planet for Canadian automobiles that can even come close to replacing the United States.
The only way we actually have a market in the United States is if we have tariff-free access. That is the only way this works. The Liberals have been saying a whole bunch of things lately, one of which is that we have to accept that there will be tariffs in order to have access to the American market. I know they are talking about auto when they say that, because apparently, a while ago, they almost had a deal with Donald Trump that would have included permanent tariffs on Canadian automobiles. Let us talk about what that means.
Right now, the tariffs work out to be about 15% on Canadian autos that get exported. The tariff is actually on the non-American portion of the vehicle. It is a complicated formula but it works out to be about 15%. When the tariff is at 15%, we are paying to Donald Trump $2.5 billion a year. The Canadian auto industry cannot absorb those kinds of losses. Let us actually break it down. If we got to something like 5%, it is $800 million. Again, these are losses that the Canadian auto industry cannot survive.
What is the plan for tariff-free access? There is no plan. The Liberals say weird statements such as that they are going to build the strongest economy in the G7. However, we have the only economy that is declining in the G7. They have all these fancy words they like to say, and then they wrap themselves in the flag and ask why we are talking down Canada.
I want to be very clear: I am incredibly proud of our auto sector. I have been on the line with auto workers. I have met with the auto workers in Brampton who have lost their jobs as a result of the incompetence of the Liberal government. Canadian auto workers make the best vehicles in the world, with the highest quality and the highest profitability. Companies should want to have manufacturing facilities in Canada to be able to export to the United States. That is why the facilities are here. We actually manufacture only 130,000 vehicles per year that are bought in Canada. Of the 1.2 million vehicles manufactured, only 130,000 are purchased here in Canada.
Let us be very clear: Auto manufacturing in Canada is critically dependent on the U.S. market, and the Liberals have no plan to gain access to the U.S. market. Our plan is to link production with the ability to import tariff-free vehicles. This is a modified version of the old auto pact.
The Liberals say we are going back in time. I think Canadians would love to go back in time, because under the auto pact, auto production in Canada went from 700,000 vehicles a year to three million. I think we would love to go back to that. If the Canadian auto sector could produce three million vehicles a year, it would be a boom to our economy and would surge employment. Instead we are going in the opposite direction with the Liberals.
We were at 1.2 million vehicles. Here is the shocking thing: Since the new government came into power with the new Prime Minister, auto exports are down 55% from the 1.2 million that we manufacture. This is critical decline. The Liberals sit there and pretend they are doing something while this is all happening. They are not doing anything.
I want to turn to some of the more troubling statements that the Liberals have made about auto in Canada. We just talked about their fantasy markets. First, it is deeply troubling that the industry minister thinks there is some fantasy market that can replace the U.S. market.
Another troubling thing is that the Liberals talk about new manufacturers coming into Canada. They talk about maybe having a Korean manufacturer come into Canada. Let us be very clear: No manufacturer is coming to Canada if it does not have tariff-free access to the United States, because 90% of the vehicles it would produce would be sold into the United States, just as 90% of vehicles currently produced in Canada go into the United States.
Another disturbing thing the Liberals have said is that maybe Chinese EV manufacturers would set up factories here. Let us break that down for a second. They would not integrate into the local parts ecosystem, because we are talking about Lego vehicles and breakdown factories. The vehicles are completely manufactured and assembled in China. They are sent over to Canada and then are assembled by very few employees.
For example, BYD, a Chinese manufacturer, has 50,000 employees in its plants in China. In its 15 plants around the world, it has 3,000 employees, because they just bang these things together. There would be no benefit for the Canadian economy. The Liberals have an EV battery strategy they spent billions of dollars on. Do we think a Chinese EV is going to use a battery made in our facilities? It absolutely would not. It would hollow out that facility as well.
Our plan is that if someone wants to import a car into Canada tariff-free, they would have to build a car in Canada. That is the rule. This would cause production in Canada to grow, from 1.2 million vehicles to two million over a decade. Taking the GST off Canadian-made vehicles would accelerate that.
This is a plan that is approved by the men and women who work on the lines in the assembly plants. The president of Unifor Oshawa assembly had this to say about our plan: “Finally, a common sense plan to protect the livelihood of thousands of Ontario Auto sector workers. A plan that restores past production levels and secures a long-term future.”
We have a plan. We believe we can convince the American President to adopt this plan. The Liberals have no plan. Why do they not vote for our plan?