Minister Vic Fedeli on Ontario auto industry: 'Lots in the pipeline'

It’s been three years since the Ontario government launched Driving Prosperity, an auto strategy to position the province as a North American leader in developing and building the car of the future. And, despite some challenges caused by COVID-19, Vic Fedeli said the plan has exceeded expectations.

Ontario’s Minister of Economic Development, Job Creation and Trade, Fedeli said the initiative, which was launched in February 2019, has resulted in $16 billion in foreign investments.

That includes a $4.9 billion electric vehicle battery plant in Windsor, a community that is undergoing a renaissance following some major financial struggles because of declining automotive manufacturing. The plant, which will be operational in 2024, is creating thousands of jobs in the city and represents the largest automotive investment in Canadian history.

Fedeli said that because of Ontario’s vast natural resources, manufacturers of electric vehicles are interested in investing in the province. As well, he said the major automobile manufacturers indicated a willingness to invest in the province if Premier Doug Ford helped reduce their manufacturing, labour and operating costs – something it has done since the Progress Conservatives came to power in 2018.

“Premier Ford and myself went back to the five auto OEMs and said, ‘We did what you asked, now what are you going to do?’ Together we wrote Driving Prosperity,” Fedeli said. “That was the plan, and it is rolling out almost picture perfect.”

Shortly after the unveiling of the Driving Prosperity plan, the world experienced COVID-19, which, among other things, crippled manufacturing and caused supply chain shortages. In the case of the automotive industry, it had to operate with stringent safety rules and a lack of new inventory – a problem which it is still dealing with.

Fedeli said once the pandemic restrictions lessened, representatives from various foreign companies met with the province, either in person or virtually, to do future deals.

“The pandemic did show us the liability of Ontario’s supply chain and how unreliable some of the world’s supply chains are, and showed us sometimes who we are friends with,” Fedeli said. “Each and every one, whether it was in Japan, South Korea, Germany and Austria, they feel the world is in a tumultuous state all around them, and they look at Ontario and see a sea of calm. That’s how they all describe Ontario.”

The Minister said the second thing he hears is that these companies feel Ontario is safe for their employees and their families.

“We turned around and told them, ‘You like what you see, now here’s why you need to be here,”’ he said. “The ecosystem that we have in Ontario they will not find anywhere else in the world. We are the number two automaker in North America and the number two IT cluster in North America.”

Building electric vehicles

When it comes to electric and hybrid vehicles, Fedeli said the plan is to produce at least 400,000 of them in the province by 2030. He said this is centred on developing EVs through extracting and refining minerals in Ontario, and manufacturing and selling and recycling batteries.

He said Ontario has “carbon dioxide-free mobility” compared the United States, using more clean energy than in places like Kentucky or Indiana. “They burn coal, we don’t in Ontario, and we have a 94 per cent clean energy grid,” he said.

“You buy an electric vehicle built in Ontario, it’s assembled with 94 per cent clean energy,” he said. “The battery will be built with 100 per cent clean energy because they can buy the clean energy credits for the last bit. In the States, they think they are driving an electric vehicle and they are solving the problems of the world. They are not. They are burning coal to make their vehicle in the States.”

Fedeli said there is “lots in the pipeline” in terms of additional revenues from foreign investments and is optimistic the province’s 2030 EV goal can be realized. While it will be up to individual companies to decide how many they produce, he said the province threw some targets at them.

“We make some investments in them and now it’s up to them to deliver,” he said. “General Motors will be the first off the assembly line with their BrightDrop Zevo 600 Cargo Van for FedEx (produced in Ingersoll). It will be the first Canadian-made battery electric vehicle that rolls off an assembly line.

Supporting Project Arrow

Fedeli said Project Arrow, developed by the Automotive Parts Manufacturers’ Association (AMPA) to produce Canada’s first zero emission concept vehicle, is a good example of showcasing Canadian know-how.

Many of the suppliers being used by the association for Project Arrow – which will be unveiled at the Las Vegas Consumers Electronic Show in January – are based in Windsor. Ontario has committed about $2 million to the project.

“Certainly, APMA with Project Arrow has shown we can do it all here,” said Fedeli, who also offered praise for APMA President Flavio Volpe, who is heading up Project Arrow with Chief Technical Officer Colin Dhillon.

“There are 700 parts makers in Ontario. There are 500 tool and die mould makers. We can build every part, every piece. It’s kind of a watershed moment. We’ve got that ecosystem here,” he said. “The Premier and I have been to as many of these places as we can. They are in solid communities that are lined up street after street with companies that are producing parts.”

No rebates

While the Progressive Conservative government of Ontario is fully committed to building electric vehicles, Fedeli said there will be no rebates for consumers. He said the decision to end the up to $14,000 in subsidies toward the purchase of EV, which was enacted by the previous Liberal government and eliminated after the PCs were elected in 2018, will not change.

“We made the decision we were going to invest in the EV sector and where our investment would be is in the creation of jobs,” Fedeli said. “We want people to have an EV built in Ontario. We’re in for about $2.5 billion taxpayer dollars. We put our incentives in the companies to create tens of thousands new jobs.