Ex-Toyota exec tapped as auto czar
Tanguay will counsel Ontario, Ottawa on promoting industry
The Canadian and Ontario governments have named an auto industry czar to lead the country’s response to growing global competition for auto assembly plants and jobs.
Ray Tanguay, who recently retired as chairman and CEO of Toyota Motor Manufacturing Canada, will advise both government and business how to promote Ontario’s auto sector.
“We’re going to have to up our game,” Ontario’s Minister of Economic Development Brad Duguid told a press conference at Ryerson University Tuesday.
“The auto industry has been calling for this type of leadership for some time.” TED ARNOTT PC MPP, ECONOMIC DEVELOPMENT CRITIC
“The reality is we’re facing increasingly intense global competition,” said Duguid.
Ontario has been losing out to other lower-cost jurisdictions, such as the Southern U.S. and Mexico. Some automakers have blamed higher labour costs in Canada.
Unifor, the union that represents Canadian Auto Workers, says Canada is being outbid by my more generous government incentive programs.
Appointing a czar to co-ordinate Canada and Ontario’s efforts “is a good first step,” Unifor president Jerry Dias said in a phone interview. But the country needs a more comprehensive auto industry strategy, he added.
No additional government funds were committed to the auto sector as part of the announcement.
Tanguay will advise governments in his new role as chair of a subcommittee of the Canadian Automotive Partnership Council, an industry led group created in 2002 to address competitiveness challenges.
An industry insider, Tanguay will have his ear to the ground and be able to get governments involved well ahead of auto company decisions, Duguid said.
Tanguay will also be in charge of selling Ontario to the auto industry around the world.
The focus will be on securing the future of Ontario’s existing auto plants, operated by five automakers, said Don Walker, who chairs the auto industry partnership council and is also chief executive officer of Magna International Inc., the country’s largest auto parts supplier.
Assembly plants have a “huge trickle down effect,” Walker said, noting every job in an assembly plant creates 7 to 10 additional jobs among suppliers and services.
In response to criticism government is doing too little, federal Industry Minister James Moore pointed out Ottawa and Ontario together pumped billions into the auto industry during the 2008-09 financial crisis to save automakers General Motors and Chrysler from bankruptcy as U.S. sales plunged.
Duguid noted the auto sector has announced $4 billion in investments for Ontario since November 2014. That includes a $2-billion investment by Fiat Chrysler in a new cross- over vehicle for its Windsor, Ont. minivan assembly plant.
But Ontario is also losing auto industry jobs. General Motors Canada recently confirmed production of the Camaro would move from Oshawa to a plant in Lansing, Mich., at a cost of 1,000 jobs.
As head of Toyota, Tanguay said he has served on internal company site selection committees, helping make decisions about where to locate plants, including the recent announcement to move production of the popular Corolla from Cambridge, Ont., to a plant in Mexico. The Corolla is to be replaced by a yet to announced mid-sized, higher value car. Tanguay said there’s no single formula for attracting new investment. Companies have different priorities and needs.
“The reality is we’re facing increasingly intense global competition.” BRAD DUGUID ONTARIO MINISTER OF ECONOMIC DEVELOPMENT
Fiat Chrysler went ahead with its Windsor investment plans, even after withdrawing its bid for government aid, saying it had become a political football.
In an unrelated development, General Motors Canada disclosed Tuesday that almost all the 1,000 job losses at its Oshawa plant will be achieved through early retirement incentives.
The Oshawa plant is losing production of the next generation Camaro to a plant in Lansing, Mich.
Additional incentive packages will be offered to nonretirement eligible employees in hopes of completing avoiding layoffs, GM Canada President Steve Carlisle wrote in a note to employees.
Ontario’s Progressive Conservative party said it welcomed the announcement.
“The auto industry has been calling for this type of leadership for some time,” PC economic development critic Ted Arnott (Wellington-Halton Hills) said in a statement.
Since 2001, Ontario has lost more than 43,000 jobs in the auto sector. Last year alone, Mexico received $7 billion in investments from automakers, the opposition party said.