Canada’s auto industry is making a comeback

Ontario and Quebec are home to the majority of Canada’s automotive industry, with Windsor, Ontario, serving as the country’s automotive centre.

From approximately 1904, when the first auto plant opened in Canada, Windsor has been the auto capital of Canada, according to Mayor Drew Dilkins. Windsor has profited from its proximity to the United States and the three major automakers located there.

Stellantis, formerly Fiat Chrysler, and South Korean battery manufacturer LG Energy Solutions (LGES) announced last year that they will invest over 5 billion Canadian dollars ($3.5 billion) in the construction of a new large-scale battery production facility in Windsor. It is anticipated that the factory would be operating by 2024 and will provide approximately 2,500 employment.

Dilkins says, “It’s a major, game-changing investment, and I’m not even sure these two words are adequate to explain its significance for our community.” This will affect future generations. [Companies] will evaluate the emerging automotive industry and consider Windsor Essex as a place to conduct business.

Stellantis and LGES’ investment is part of a bigger trend that has seen over CA$17 billion in announced investment in Ontario’s automotive industry since the start of 2021.

Flavio Volpe, president of the Canadian Automotive Components Manufacturers Association, states that in the previous two years, Ontario has seen the most new investment in vehicle manufacture in its history.

The majority of this investment, almost $13 billion, is in electric and battery manufacturing. And by approving the Inflation Reduction Act, U.S. politicians have bolstered Canada’s EV ambitions further.

Shortly after President Biden signed the law, Canadian Prime Minister Justin Trudeau tweeted, “This is wonderful news for Canadians, for our green economy, and for our expanding EV manufacturing sector.”

The law offers tax benefits for buyers of electric vehicles, but only if the vehicle is primarily manufactured and built in North America and its battery contains locally mined components. According to David Paterson of GM Canada, this might provide Canada an advantage over the United States and Mexico.