LILLEY: Stellantis Brampton plant the cost of Mark Carney’s trade war politics
· Toronto Sun
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If the Carney government truly wanted to save the Stellantis plant in Brampton, it would be spending more time focused on Washington, D.C.
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Canada’s entire auto industry relies on access to the American market, and for nearly two years that access has been in doubt.
There were claims that talks had picked up and there might even have been a deal before the U.S. midterms, which happened last week.
That appears to have been a mirage, at best a false claim floated by U.S. President Donald Trump in an attempt to save some seats in border states. While government contacts confirm there are talks, they are vague and not being held at the highest levels.
“There’s no sense of urgency,” said one source familiar with the talks.
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Stuck on trucks
Talks broke off in August for one main reason – the Americans refused to budge on their 25% tariff on medium- and heavy-duty pickup trucks. While they agreed to a lower tariff for passenger cars, SUVs, vans and light-duty trucks, they dug in on the heavy-duty vehicles.
Those are the kinds of trucks made in Oshawa by General Motors and in Oakville by Ford. Baking that 25% tariff into the deal going forward was untenable.
But since then, there has been no attempt to break the logjam.
“No movement as of yet,” said one source briefed on the auto side of the talks.
Prime Minister Mark Carney has claimed the deal the Americans wanted would have restricted our sovereignty and dictated cultural policy, including French-language policy. Discussions with representatives of six different provincial governments, as well as political and industry officials, cast doubt on those claims.
A member of the Quebec delegation went so far as to say that before the talks broke off, the federal government didn’t even flag French-language policy as a sticking point.
Brampton pays the price
So here we are, nearly three months later, and we still don’t have a deal, but autoworkers at the Stellantis plant in Brampton have been told their jobs are gone. Stellantis is selling the plant to a defence company and, according to reports, leasing back part of it to assemble Chinese electric vehicles from knock-down kits.
Think of knock-down kits as the automotive version of Ikea furniture. All you do is open a box and assemble it.
There are no parts jobs that would support those cars being built, and knock-down kits require fewer assembly workers. Some will cheer that they get a cheap car, but Canada loses a key industry to a global competitor that subsidizes these vehicles and uses cheap and, at times, slave labour in production.
Facilities assembling knock-down kits in Europe and South America have already resulted in job losses and a loss of market share for domestic makers. In Europe, Chinese vehicles accounted for 0.2% of all cars sold five years ago and are now at 10%, while in Brazil, a major auto manufacturing centre, Chinese vehicles account for 20% of the market, up from 2% in 2021.
Chasing China, not a deal
Carney and his government have been visiting China and praising Chinese vehicles. They have courted Chinese automakers to come to Canada, including through partnerships like the one likely destined for Brampton.
What he should have been doing is visiting Washington and fulfilling his election promise to get us the best deal.
Instead, he walked away in August and declared that we are at war.
That’s good politics, but it’s horrible economics. For an economist, Carney has certainly adapted well to politics.
He knows that fighting with Trump keeps his political popularity higher, so he does it even at the expense of Canadian jobs.
Carney’s supporters will tell you that he’s pivoting us away from the United States, that he’s signing more trade deals. Signing more trade deals is a good thing, and so is diversifying our trading partners.
The problem is that the Ford F-350 being built in Oakville isn’t going to be sold in Europe, India or the Philippines. While these trade deals work their way through our system, we still need a trade deal, a better trade deal, with the U.S.
Carney is too busy heading off to China once again, as he will next week.
Meanwhile, Canadian workers suffer.