Skip to main content

Report On Business Auto-parts industry touts integration ahead of trade talks

A worker in the Magna plant in Puebla, Mexico, Wednesday, January 22, 2015. A new study says Canadian auto-parts companies now employ more people in the United States and Mexico than the entire auto-supplier sector employs in this country.

Brett Gundlock/ Boreal Collectiv/The Globe and Mail

Canadian auto-parts companies now employ more people in the United States and Mexico than the entire sector employs in this country, according to new data that industry and government officials will showcase to try to avert drastic changes to the automotive provisions of NAFTA.

The numbers show Canadian companies employ about 86,000 people at factories located in Canada's two North American free-trade agreement partners, compared with about 71,000 in the auto-parts sector as a whole in Canada, calculations done by the Automotive Parts Manufacturers Association of Canada show.

The APMA study will help backstop the strategy the federal and Ontario governments and the auto industry have adopted in the run-up to a renegotiaton of NAFTA: convincing the administration of U.S. President Donald Trump that wholesale revisions of the trade agreement would endanger the prosperity of the United States.

Story continues below advertisement

U.S. negotiators are expected to focus on automotive trade in NAFTA talks – in part because Mr. Trump has singled out that sector as one where Mexico has benefited disproportionately from the deal, causing U.S. jobs to flow south.

The auto sector is also the poster child for continental integration. Vehicles and parts are made in each of the three countries and shipped duty-free among them.

"NAFTA is an integrated automotive superpower," said Flavio Volpe, president of the APMA, "and Canada's interests go throughout the North American map."

The enumeration of Canadian auto activities showed that Canadian companies operate 150 factories in 23 U.S. states and 120 plants in Mexico.

Michigan has the largest Canadian contingent with 50 plants, followed by Ohio with 18 and Tennessee with 16.

The data pinpoints factory locations in Congressional districts, so that the local member of the House of Representatives might get a call from a plant manager at a Canadian-owned factory pointing out the number of jobs that depend on the smooth trade flow continuing, Mr. Volpe said.

The lobbying is already underway, although at a higher level. Ontario Premier Kathleen Wynne visited Michigan last month to meet with Governor Rick Snyder and telephoned the governors of Tennessee and Indiana last week.

Story continues below advertisement

Navdeep Bains, federal Minister of Innovation, Science and Economic Development, who has responsibility for the auto industry, spent several days last week in Michigan, where he gave a speech to the Michigan legislature in Lansing, and met with ‎the chair and members of the M‎ichigan House of Representatives Commerce and Trade Committee.

Canadian officials will rely on U.S. governors, senators and representatives to pass the information up the chain to the White House.

Brad Duguid, Ontario's Economic Development Minister, said the strategy is to remind Americans that it's in their "enlightened self-interest to ensure that the White House is aware of the importance to American jobs of maintaining an unfettered border, particularly in places like the auto sector."

Not only do about 43,000 Americans work for Canadian auto-parts companies, but Mr. Duguid noted that the jobs of many hundreds of thousands of other Americans depend on smooth trade between their country and Canada.

The jobs data show that Canadian companies have a big stick to wield. Magna International Inc., which is based in Aurora, Ont., and is the largest auto supplier in North America, has about 25,000 employees at U.S. plants in Michigan, Tennessee, Ohio and other states, according to regulatory filings and news releases.

Engine and transmission parts maker Linamar Corp., Canada's second-largest auto parts company by revenue, has about 1,000 employees in five U.S. states.

Story continues below advertisement

The figure of 71,000 people as a whole in the auto-parts sector in Canada is a Statistics Canada number. The APMA uses a different assessment that includes about 10,000 employees in the machine, tool, die and mould sector.

That leads to a total of 81,000 people working in the parts sector in Canada, still fewer than the 86,000 employees at Canadian-owned parts factories in the United States and Mexico.

Want to interact with other informed Canadians and Globe journalists? Join our exclusive Globe and Mail subscribers Facebook group

Report an error Editorial code of conduct
Tickers mentioned in this story
Unchecking box will stop auto data updates
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

Cannabis pro newsletter