There is concern among some lawmakers and the auto industry about the potential of a Chinese electric vehicle assembly plant in Ontario.
According to Bloomberg, Stellantis was in talks with a Chinese partner to turn its idle Brampton assembly plant into a Chinese EV vehicle manufacturing hub.
Canada’s electric vehicle market is already in a state of change after Prime Minister Mark Carney reached a deal with Beijing to allow up to 49,000 Chinese EVs into the Canadian market.
Now, Stellantis wants to take the idea a step further. It is reported to be in talks with Zhejiang Leapmotor Technology to make its Brampton plant into a Chinese EV hub.
But already there is considerable push back. Ontario Premier Doug Ford and federal Minister of Industry Mélanie Joly are both against the idea.
So, too, is Flavio Volpe — the head of the Canada's Auto Parts Manufacturers Association.
"The proposal is to bring kits in from the other side of the world like IKEA furniture," Volpe said. "That shows up already manufactured. Maybe take some doors off. Maybe take some wheels off. They open the boxes. They’ve got some wrenches, they’ve got some screw drivers and put them together. The only investment there is in the 300 or 400 peoples' salaries there. $25 million worth of local spend verses $3 billion. Three hundred jobs verses 12,000 jobs."
Volpe also said if the federal government allows one auto maker to to ahead with this type of arrangement it could set a dangerous precedent.
"It would create all kinds of pressure on the other four that are here to have to compete," he said. "And it completely freezes out any of that economic activity that comes from the parts suppliers in Canada or the U.S. It tells the Americans: 'We don’t want your parts or your steel or anything. We’re happy to give the market away to the Chinese.' It’s stupid."
Lana Payne, President of Unifor, Canada’s largest private sector union, agreed the reported deal between Stellantis and the Chinese company is not a positive direction for the industry in Canada.
"We were very, very concerned when the Canadian government signed the deal with China recently that we would end up in this situation," she said. "Because China doesn’t actually build in the supply chain around the world. They don’t manufacture cars in other parts of the world. They manufacture them in China and they send them around the world to be assembled in these little kits. If that’s the future of the Canadian auto industry, then we’re in very big trouble."
Joly already said Ottawa won’t support the idea.
We can’t bring cars-in-a-kit to Canada," she said. "Why? Because one of the big parts of our auto industry is actually linked to the fact that we have a big auto parts sector — 200,000 workers."
Stellantis' Brampton plant has been shuttered for more than two years. In October, the auto maker said it was moving production of its Jeep Compass to Illinois to boost production.
Volpe said there is room for Chinese-made EVs in Canada — if the parts are made in North America and the vehicles are fully assembled in Canada.
