Latest / Kvetch & Release / Is Canada’s EV industry at risk without ongoing US EV support?

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Is Canada’s EV industry at risk without ongoing US EV support? · Kvetch & Release

• 0:02
  Hey, folks, we're back. Hope you're all doing well. It's been
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  the talk of both sides of the border, both federal governments, the EV
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  industry and the subsidies associated with them. And with the upcoming federal election,
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  I think the you know, the Biden administration was hoping for a bigger convergence
• 0:21
  of support around it all. But here we are, and Senate Democrats are
• 0:27
  actually distancing themselves right now if they're in red states, because they don't want
• 0:32
  to be too tied to these EV policies right now with Republicans going off on
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  the offensive against Biden's environmental agenda, and at the same time, we know
• 0:41
  that the presumptive GOP nominee, former President Donald Trump, has been making a
• 0:46
  whole campaign out of tearing up all of those subsidies. He doesn't like the
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  push towards green that President Biden has pushed through. And the question that I
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  had sort of musing around the back of my head today was is our EV
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  industry here in Canada at risk without ongoing US EV support across the border.
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  Joining me right now, someone who knows all about this file and more is
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  Flavio Volpe, the president of the Automotive Parks Manufacturers Association of Canada FLAVIO.
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  Are we at risk up here if things go the way of Donald Trump down
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  in the South. I don't think so. I think it's amusing that people
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  have plicized the fuel or the energy source for how their cars run, but
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  understandable because politicians have seen fertile ground in it. In Canada, eighty percent
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  of the cars that we make, so that's two million cars a year,
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  and one point six million of them get exported to the US. Biden's plan
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  is one hundred percent EV by twenty thirty five. You and I have had
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  lots of discussions, most of them on air, where I say, well,
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  I think that number is thirty five percent, But thirty five percent of
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  the US market is like six million, and so Canada's EV manufacturing proposition is
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  safe even if the Americans fail horribly against our targets. But I think Canada's
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  EV mandates locally here are unachievable, and I think will be part of the
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  political debate in our federal election. Well, and we're waiting to see what
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  our federal conservatives have to say. They've been reasonably tight lipped about whether or
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  not he support is ongoing. But we have also just found out, like
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  relatively breaking news within the past fifty five minutes that our ED strategy, which
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  is of course a fairly expensive one already, is going to be getting a
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  bit more expensive potentially, with our Parliamentary Budget Officers saying that the ED strategy
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  is going to cost six billion more than announced. What's your take on that
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  one? Well, you know, I think your listeners know how I feel
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  about the Parliamentary Budget officers mass. It's really never includes the activities in the
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  supply chain and then always includes the maximum amount of production subsidies. If all
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  of these plants went gangbusters, how much would we pay for that extra production?
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  The math isn't very good, and I can't tell you how many times
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  I got a publicly school and then be embarrassed for him that he keeps coming
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  back with the same analysis. But I think contextually what's important is it's a
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  very interesting subject for a lot of people. People who are in the business,
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  are not in the business. People have competing interests with automotive who would
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  like to see they're interest funded. So I think it's incumbent on those of
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  us who are advocates for that industry to keep pointing out that if Canada was
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  to pay the maximum subsidies, it would be because all of those battery plants
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  would be at full capacity. That means they'd be doing thirty billion dollars of
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  business incremental business a year, generating something like four and a half to six
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  billion dollars of new taxes of the year, and if that happens, Canada
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  would pay some of that back to those companies. These are the kind of
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  bets you want people to make. But y they're getting they're getting a little
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  bit, they're getting complicated, and so a little bit more difficult to explain
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  simply in their defense. Well, I mean, we have been talking about
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  this fairly often. It is still surprising to me that what on face value
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  looks like it could be pretty complicated. When you break it down, you
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  make it make a lot of sense. This would not be a problem to
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  have to be spending the total amount output of fifty two and a half billion
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  if everything was running at one hundred percent capacity. I mean, we'd be
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  cooking with fire here. Yeah. You go to the Parliamentary Budget Officers report,
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  it says forty six billion dollars in investment by industry and about fourteen billion
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  dollars worth of the traditional government partnership in it. So that's you know,
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  that's about twenty percent of the of the total amount, which is what we've
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  always done, what other states always do. And the debate is whether we
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  should give companies some of the tax backs that they generate on new activity.
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  You know, there's these are tough times for a lot of people across the
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  country. There are industries and regions that are not enjoying the same good news
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  that southwestern Ontario and Whins specifically are getting. I get it. We've been
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  on the other side of that. You know, for us the decade before
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  that, people were presiding over the presumed death of the auto sector while other
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  regions like the West were booming. We got to be sensitives to it.
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  But I'm not going to lie down on it. I think that what we've
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  done in the last two three years and governments of both stripes, conservative and
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  liberal governments, have set us up or helped set us up for the touches
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  of investments that are going to build careers for our kids in the industries that
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  we're currently working in, and not just precarious jobs. Hey, by the
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  way, go do the next few years over at windsor Assembly, and then
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  we'll see what happens after that. No, it's like, hey, listen,
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  you want to be in this business for the next twenty thirty years.
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  Now you can think about it. Well, it's where industry has decided to
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  go, it's where government has decided to support. It is what the market
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  has decided that they want. Increasingly, I don't see any reason why not
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  to continue moving forward with it, whether or not it is a bet to
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  call it, or you know, just a sound fiscal investments or somewhere in
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  between. It's always really important to have someone as knowledgeable as you are,
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  Flavio, come join us and break it all down, because it can get
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  confusing sometimes. Well I appreciate that. Let me leave you with the one
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  last thing. In the last three weeks have been in Tokyo and in Wolfsburg,
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  and so in both those places they know where windsors and they talk about
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  it, and they talk about London, they talk about Kingston, and they
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  talk about bit A Core and that's especially new and it's because we've decided to
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  do this and stick with it and defend it. So I'm very happy that
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  there's a massive team that's now moving in the same direction. Team Canada approaches.
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  They've worked in the past, no reason they can't work again in the
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  future. Flavio, thank you so much for your time today. Thanks Jan,
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  you have a great one. Flaviov. Flavieville is the president of the
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  Automotive Parts Manufacturers Association of Canada. And as you heard right there, windsor
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  is I guess on the world stage right now.