Prime Minister announces first investment under Automotive Innovation Fund

Windsor, ON
3 September 2008

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Good afternoon, ladies and gentlemen. Thank you very much, everybody.  Thank you, Jeff, for your kind introduction. As many of you know, Jeff is of course the Member of Parliament for Essex. He is a member of the House of Commons standing committee on the Environment and Sustainable Development, and he's Vice Chair of the Conservative Party's auto caucus. Jeff also has the distinction of being the first auto worker ever elected to the House of Commons.  So it's no surprise he's been a passionate advocate for the Canadian auto industry in this community and in Ottawa. Greetings to Minister Prentice, who will speak in more detail in a moment, and without whose hard work, today's announcement would not have been possible. Greetings also to my colleague Dave Van Kesteren and to Your Worship the Mayor.  Thank you to David Schock and Gary Johnson for showing me around the plant this morning, and a special thank you to Adrian Vido and everybody here at Ford, all the management, all the union officials for welcoming us today.

Ladies and gentlemen, the auto industry is one of Canada's biggest economic and industrial success stories. Canadian auto workers have been making the world's best cars and trucks for a century. Especially after the signing of the 1965 trade agreement with the US known as the Auto Pact, Canada became one of the leading auto manufacturers in the world.  The industry has created hundreds of thousands of high-paying jobs for Canadians. The parts and assembly plants have fuelled the growth and prosperity of countless communities across Ontario and the development of related industries have helped industrial development throughout central Canada and indeed, throughout the entire national economy.

To this day, the automobile sector is Canada's largest manufacturing industry, a key driver of technological advancement and a major contributor to our national economy. It directly employs 150 000 Canadians. Each of these creates five more indirect jobs and it accounts for nearly a quarter of our manufacturing exports. But just as the auto industry is critically important to Canada, today the Canadian automotive sector faces some of the most critical challenges in its history. The demise of the Auto Pact back in 2001 was a blow. International competition has been getting stronger. Patterns of market demand have been shifting rapidly. Volatile currency markets have not helped, and the downturn in household consumption spending south of the border is depressing sales.

These are all tough challenges, but they are not insurmountable. Canada has a number of formidable competitive advantages, including an industrious, dedicated and highly skilled workforce; healthy and growing investments in needed infrastructure; and auto manufacturers renowned the world over for their quality and productivity.  We need to build on these advantages with new technologies that ensure we're doing two things: first, building cars and trucks that are on the cutting edge of consumer demand, and second, building those vehicles with state-of-the-art production equipment. There are 28 car and truck models currently manufactured in Canada. Over the next five years, the auto companies will decide the fates of 19 of those models. Those decisions will be based on a host of complex factors, but the most important one is this: which vehicles are consumers going to want, and which plants are going to be able to produce them at the most competitive price.  The answers to these questions will not be found in old-fashioned industrial subsidies.

There's no future in shovelling money into status quo automotive designs and production technologies.  But there is a future in providing support for next generation designs and technologies.  That's why Budget 2008 established Canada's Automotive Innovation Fund, with a quarter billion dollars over the next five years to support this transition. The Fund will assist auto makers to ensure that vehicles manufactured in Canada are meeting evolving consumer demand with innovative production technologies. It will preserve and create high-quality jobs by ensuring the Canadian auto industry develops the technologies to compete with anybody in the world. The Automotive Innovation Fund is only one of our Government's actions to get our industry out in front of the competition and stay there. We've also cut taxes to business, lowered the GST for consumers and introduced generous capital cost allowances for manufacturers.  We’ve pursued an aggressive agenda on regulatory cooperation with the United States, the export destination for more than 80 per cent of cars and trucks built in Canada, and we pledged support for the Windsor-Detroit gateway, the main point of entry for Canadian-made vehicles into the US market.

But today we are here to launch the very first project flowing from the national Auto Innovation Fund. As you already know, it's an investment right here in Windsor, so I'm going to call on Minister Prentice to give you all the details. Thank you very much.