The last time I had a long conversation with Ray Tanguay, we were crawling under a Lexus concept car at the Detroit auto show.
He is, without a doubt, a car guy. He's also a manufacturing whiz, a Canadian jobs hero and most assuredly one of the most politically savvy people ever to hold a senior position in the auto industry.
If Ray Tanguay cannot find a way to stem the steady decline of what was once a proud Canadian auto industry, surely no one can. He knows cars, he loves cars, he's fascinated by how they are designed and manufactured, he's forthright and he has a sterling reputation for honesty.
Tanguay rose to the highest levels of Toyota Motor Corp. during his long career, ending as chairman of Toyota's Canadian operations. He's now been tasked with helping the Canadian and Ontario governments find a way to lure new automotive investment to Canada – and convince those still assembling vehicles in Canada to stay here, rather than move to Mexico or the southern U.S. where labour costs are lower and work rules are more flexible.
Aside from an astute business mind - one very clear on the bottom line of auto manufacturing - Tanguay brings unique personal skills to his latest role, which is essentially an expanded version of his work as chairman of the Canadian Automotive Partnership Council. Canada was once the world's fourth largest auto-producing nation, but no more. He's needed.
Labor costs, the recent strength of the Canadian dollar and the declining value of the Canadian health care system in terms of reducing manufacturing costs have all hurt investment in Canada. At the same time, U.S. states like Georgia and Tennessee, and Mexico in general, have used generous bribes – uh, incentives – to lure new auto manufacturing to their regions. In Canada, it is not politically possible to bribe automakers to build cars – at least not possible to make obvious bribes.
Nonetheless, business is all about deals between business people who trust one another and this is where Tanguay has an edge over every other Canadian and most others no matter their passport. I know this from personal experience.
He once explained to me how he convinced Toyota to give its Cambridge plant the first opportunity to build Lexus models outside of Japan. This was no small feat. But he painstakingly explained how his Canadian workforce was up to the task of building the highest quality vehicles not just in the Toyota world, but in the whole world, period.
When Toyota went looking for a place to assemble RAV4 crossovers, he again sold Toyota on a new facility in Woodbridge, Ontario. The skill and reliability, the pure professionalism of the Canadian workforce, fit with Toyota's commitment to quality, he told me. He made the bottom line work for Toyota by highlighting the bigger picture beyond pure labour costs.
Here's Tanguay's scorecard: in 1991, when he joined Toyota, the company had a small three-year-old plant in Cambridge. There, about 1,000 Canadians snapped together about 70,000 Corollas. Today, Toyota has about 8,000 manufacturing workers; last year they assembled about 580,000 Toyotas. The quality of the vehicles coming out of Toyota's Canadian plants is second to none in the world.
So Tanguay brings to the job of selling Canada's automotive expertise a respected track record of accomplishment and integrity. He is the kind of car boss who loves digging into the details of making cars. His passion is infectious. At that Detroit show, he pointed to bits and pieces under that concept Lexus, describing how this could be built now and what might not be possible in other areas of the show car. The public relations people watching had a fit, fearing he was revealing cherished secrets to this ink-stained wretch of the news media.
That said, he's also a normal guy who likes to ride snowmobiles in the winter. Unaffected? Certainly.
We don't celebrate Canadians such as Tanguay very often. We should. He's the best hope Canada has of retaining and adding value-added automotive manufacturing jobs. Yes, he's a car guy through and through. And I do love real car guys.
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