Ontario pledges $40.2 million to bolster auto sector
February 15, 2019
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Ontario announced $40.2 million in technology-focused funds for the auto industry, aimed largely at developing next-generation manufacturing workers, as part of a new 10-year plan.
The strategy, aimed at growing a sector grappling with technology and trade disruptions, comes as General Motors Co plans to shutter its Oshawa assembly plant by year-end, part of a broad restructuring to cut costs and boost investment in electric and self-driving vehicles.
“It’s a very good first step,” Flavio Volpe, president of the Automotive Parts Manufacturers’ Association, told Reuters. “The supply sector doesn’t need big investment funds. We need programs that target productivity and skills training.”
The plan does not address the Oshawa closure, said Ontario’s Minister of Economic Development, Job Creation and Trade, but is designed to make the province more attractive to future investment.
“We actually have something to sell now,” Minister Todd Smith told Reuters, adding that the government has talked with a range of manufacturers in and outside Ontario about the Oshawa plant, though he declined to say if any talks were advanced. “We’ve piqued the interest of other companies.”
While Ontario represents 13 percent of North American vehicle production, it has attracted only 6 percent of automakers’ new investment since 2009, the government said.
Auto production has declined by 25 per cent since 2009 in the province, the government added, reflecting a shift to lower-cost regions, such as Mexico.
The autoworkers’ union president, Jerry Dias, told Reuters the provincial plan was a “poor diversion” from the high-profile solidarity concert that British musician Sting held for GM workers in Oshawa on Thursday.
“He’ll have a hard time creating new auto jobs when he doesn’t fight to keep the ones that he has,” Dias added.
The province’s three-year grant program commits $19 million towards internships and training, $3.2 million towards online learning and $2 million to an autonomous talent development program. A new $3 million fund will support winter testing of mobility products.
A $10 million grant program for parts suppliers, which requires matching industry investment, is aimed at technology adoption that boosts productivity and exports. It replaces a previous program, for which funding was not immediately clear.
The plan also aims to make Ontario more competitive, with a target of reducing regulatory burdens for the auto industry by 25 percent by 2020, through such measures as streamlining.