Last week, the Harper government announced that it would commit $250 million in support of Canada’s auto industry. The investment, which represents a five-year extension of the Automotive Innovation Fund, aims at creating jobs and attracting investment in a sector which has witnessed significant shrinkage in the last decade.
During a visit to Ford’s Oakville, Ont. assembly complex, Prime Minister Stephen Harper said that with the new investment “our goal in creating this fund was to promote and secure more high quality manufacturing jobs for Canadian workers in this industry through innovation.”
The announcement comes following the decision by General Motors to shift production of its Chevrolet Camaro pony car from Oshawa, Ont. to Lansing, Mich. a move that has incensed the Canadian Auto Workers union, especially considering the funds provided by both the federal and Ontario governments to help GM emerge from bankruptcy.
CAW President Ken Lewenza, who also attended the event at Oakville Assembly, said that while he welcomed Ottawa’s support for the auto industry in this country, he also emphasized that Canada still needs to do more in order to match incentives being offered by other countries, including several U.S. states. “I’m very grateful for the fact that they established the fund,” he stated,” but I still think we have to look at how we sustain it long term, because what we know is investment comes and goes.”
Canada, which according to the CAW has tumbled from the fourth largest auto manufacturing base in the world in 1999 to below 10th, has struggled to remain competitive against the U.S. and other countries when it comes to auto production, hobbled by high wages and the continuing high value of the Canadian dollar against other currencies, notably the U.S Greenback.
As a result, a number of automakers, including General Motors, Mazda and Volkswagen have been looking to the U.S. and also Mexico, when it comes to establishing and expanding manufacturing capacity.
