A Canadian initiative that analyzed the economic impact of the auto industry’s shift from producing internal combustion engine vehicles to battery electric found that Canada has a lot at stake as it adjusts to a more zero-emissions future.
In a news release, the Future of Canada’s Automotive Labourforce, otherwise known as FOCAL, said the shift to EVs offers several opportunities — such as developing new domestic supply chains and broadening existing manufacturing capabilities. But on the downside, it also paves the way for multiple challenges. As a result, FOCAL created three scenarios to consider.
The first is greater acceptance of EVs by consumers, leading to success in garnering production mandates, producing and processing rare earth minerals at home, and in manufacturing EVs and their batteries.
The second scenario sees slower consumer adoption of EVs, which means slower EV manufacturing and fewer batteries being produced. And of course, less success in the rare earth mining capabilities arena, and in winning production mandates. FOCAL also sees initial job and economic losses within the first few years of EV transition for this scenario.
The third scenario combines assumptions from the first and second. FOCAL predicts for 2040 output reaching $13.3 billion and 27,000 jobs being added as a result of the EV transition.
“We wanted stakeholders to understand both the potential upside for the Canadian economy, and that there is a lot of uncertainty,” said Ken Delaney, Executive Director of FOCAL, in a statement. “Considering the importance of the auto industry to Canada’s economy and the number of jobs at stake, it is important that all stakeholders understand the implications of this looming transition.”
The full report is available here.
