What’s Next for Canada’s Automotive Industry?

Canada’s automotive industry spent the past decade recovering from the 2008-2009 recession, but now faces such new challenges as bouncing back from the effects of the COVID-19 pandemic and capturing a significant share of production of electric vehicles and components. 

Those are among the conclusions of a Trillium Network for Advanced Manufacturing review of the decade in the vehicle assembly and automotive parts manufacturing industries in Canada. Several key measures of these industries showed sharp rebounds from the 2008-2009 crisis, but others—including contributions to GDP, annual capital expenditures, and Canada’s automotive trade balance–declined from where they stood in the previous decade.

The study underlines, however, that the sector is still a vital part of the economy, especially in southwestern Ontario. A key question for the 2020s, the report notes, is how Canada will expand its participation in the manufacturing of electrified vehicles and components for those vehicles.

“Canada may want to increase its emphasis on attracting investments in specific activities as a first step toward developing a more robust electrified vehicle manufacturing industry,” said Brendan Sweeney, author of the report and managing director of the Trillium Network. “If we want these investments, we need to think of some new and unconventional ways to attract them while maintaining high-paying jobs. The Canada-U.S. Auto Pact was unconventional thinking, as were other policies that built the industry. We have a real opportunity now as we reset the economy, post-Covid.”

The automotive industry’s quick pivot to manufacturing personal protective equipment (PPE) and medical device components in the midst of the pandemic provides more evidence that the sector is a vital contributor to Canada’s economy, he said.

Download the full report. 

For more information contact:
Brendan Sweeney, PhD
Managing Director
Trillium Network for Advanced Manufacturing
e. bsweeney@trilliummfg.ca