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National Observer
38 minutes ago
- National Observer
Ottawa warned early in new year of wheels wobbling on $100 billion EV strategy
The federal government was warned early in 2025 that its $100 billion electric vehicle strategy was in danger of being run off the road by slowing North American EV sales and the economic mayhem sown by US President Donald Trump's tariffs on Canada, a newly released document reveals. François-Philippe Champagne, then federal minister of Innovation, Science and Economic Development Canada, was sent a briefing note on Jan. 10 by his deputy minister, Philip Jennings, that flagged 'a decline in expectations' among EV makers that imperiled the plan's progress. 'The slowdown in growth has contributed to delays, modifications, or scaling back of planned investments' in the auto sector despite tens of billions of dollars in investments having already been announced, Jennings said in the document obtained by Canada's National Observer through an access to information and privacy request. The briefing note was delivered to Champagne only weeks after he told CNO that critics of the government's embattled EV strategy lacked 'vision and ambition.' Champagne was named Minister of National Revenue in a cabinet shuffle after the Liberals won the April federal election that also saw Mélanie Joly take over the Industry, Science and Economic Development portfolio. Developing an EV industrial ecosystem from mining critical minerals used in vehicle batteries to new assembly lines for electric vehicles would give Canada a competitive advantage in a global industry 'for decades to come — but not overnight,' Champagne said in December. Joly's office told Canada's National Observer that it 'recognizes the sector's concerns and is continuing to engage meaningfully with industry stakeholders to address and alleviate challenges' linked to US tariffs, though no specific action plan was outlined in its response. 'Despite short-term policy fluctuations, the long-term trajectory for EV adoption remains strong,' says Dunsky Energy analyst Lindsay Wiginton 'Our government is working to ensure EVs are made in Canada, so Canadian workers benefit from the growth and jobs in this industry," said a spokesperson. Canada's EV plans going flat? A total of $46.1 billion in investments across the Canadian EV supply chain was announced by automakers including Honda, Volkswagen, GM and Ford from October 2021 to April last year. Federal and provincial governments pledged $52.5 billion in incentives, tax breaks and other support, according to Canada's Parliamentary Budget Officer, which provides economic analysis to the government. But dark skies have threatened the EV strategy and long-term future of auto manufacturing in Ontario as the Canada-US trade war drags on. In April, GM shuttered its CAMI assembly plant in Ingersoll, Ont., where it builds an electric delivery van. GM expected to reopen the plant at 'half capacity' in the fall. Ford and Stellantis, which cited tariffs as a major factor in a $3.7 billion loss in the first half of 2025, have also suspended or delayed EV production in Canada. Some 40,000 EVs have been produced to-date in Canada, which in 2024 imposed a 100 per cent tariff on imports of Chinese EVs to protect the domestic industry. China made 12.4 million electric cars last year, accounting for 70 per cent of global EV output, according to the International Energy Agency. Battery makers have hit speed bumps too. A planned $7 billion EV manufacturing plant in Saint-Basile-le-Grand and McMasterville, Que, collapsed after Swedish battery maker Northvolt declared bankruptcy in March. The Quebec government lost a $270 million investment in the project. More recently, trouble emerged at the $5 billion NextStar EV battery factory being built by Stellantis and South Korea's LG Energy in Windsor, Ont. Several Canadian contractors have filed lawsuits alleging millions of dollars in unpaid work at the plant, which has received $15 billion in federal and provincial incentives, according to media reports. Jennings said in his briefing note that slowing EV purchases had 'created doubt in the trajectory of [future] sales'. Trump's executive orders soon after taking office to scrap Biden-era EV targets and tax credits, along with the end of federal EV incentives in Canada, have 'added uncertainty' in the market, the note said. 'In the long-term these impacts on their own are unlikely to jeopardize the prosperity of the automotive sector in Canada, but they depend on the electrification plans of the manufacturer and the health of the sector overall, including the impact of potential U.S. policies and tariffs,' Jennings said. EV transition 'unstoppable' The federal government should stick to its long-term plan for an EV supply chain in Canada because the global shift to EVs is 'unstoppable,' said Matthew Fortier, CEO of Accelerate, a Toronto-based zero-emissions vehicle industrial alliance. There are signs of 'underlying momentum' for Canada's EV industry, said Lindsay Wiginton, managing consultant at research house Dunsky Energy. She noted many analysts have a positive global EV outlook, including projections that a quarter of all cars sold in 2025 will be electric. That growth is 'driven in large part by the continued decline in lithium-ion battery costs that is helping to bring more affordable EV models' to market, she said. 'Despite short-term policy fluctuations, the long-term trajectory for EV adoption remains strong,' she added. Some auto makers are less optimistic. They want the federal government to drop a mandate for EVs to make up 20 per cent of cars sold in Canada by 2026 and 100 per cent by 2035 – arguing that slowing EV sales and US tariffs have delayed efforts to build an electric vehicle supply chain. Ontario Premier Doug Ford, speaking at a joint press conference on Tuesday with Alberta's Danielle Smith and Saskatchewan's Scott Moe, said: 'We have to get rid of these mandates. The companies won't be able to meet these targets. But let's not stop spending. I am confident that the EV sector will grow eventually.' Environment Minister Julie Dabrusin has been unswayed by their arguments so far, according to media reports. Canada's 'competitive advantages' Fortier said Canada's automotive sector cannot hope to be 'globally relevant in 10-15 years' unless Ottawa focuses on 'competitive advantages that our neighbours don't have' in areas including critical minerals, advanced industrial materials, and EV battery technology. 'If we do that now, Canada can become a necessary part of the continental supply chain, and we can have leverage in the auto sector when EVs are the dominant mode of vehicle production in North America,' Fortier said. The US is by far the biggest market for Canadian-made cars and trucks, with 93 per cent of the $51 billion in vehicles exported in 2023 shipped south of the border, according to the Canadian Vehicle Manufacturers' Association, an industry trade body. The US imposed a 25 per cent tariff on Canadian auto makers and parts manufacturers in April, forcing hundreds of job losses in Ontario, the industry's historic heartland. Trump has threatened to raise the tariffs to 35 per cent on Aug 1. A high-profile US-Japan trade deal announced today (Wednesday) will see the US tariff on Japan's auto sector lowered to 15 per cent from 35 per cent. That deal might point to a possible reduction in US tariffs on Canadian car makers, but it is not a long-term solution, Fortier said. 'Any standing tariff on Canadian-made cars is a reminder that we urgently need to develop more negotiating leverage. The way to do this is to build upstream and midstream capacity for the batteries that will power the future of this sector,' he said.
CTV News
17 hours ago
- CTV News
Ford expands recall for thousands of Canadian vehicles over engine concerns
Ford has expanded a Canadian recall to include more SUVs over a defect that could cause the vehicles to catch fire. An advisory posted by Transport Canada said a fuel injector may crack on certain vehicles, causing fuel to leak into the engine compartment and create the risk of a fire. The advisory issued earlier this month adds the 2024 Ford Bronco to a list of previously recalled vehicles. The addition brings the total number of vehicles impacted to 70,618, all of which have a 1.5 L EcoBoost engine, the notice stated. Ford said it would notify affected owners by mail, and that dealership mechanics will do an interim repair by updating the engine control software to detect fuel injector leaks. 'Once the final repair is available, you will need to return to a dealership,' according to the recall advisory. 'The final corrective actions for this recall are under development.' The recall affects Bronco Sport SUVs from 2021, 2022, 2023 and 2024, as well as Escape models from 2020, 2021 and 2022. In the United States, officials have warned drivers facing similar issues to watch for a strong fuel smell, dashboard warnings, smoke or flames. The U.S. recall affects 694,271 Ford crossover SUVs over similar concerns with the fuel injector, Reuters reported on July 16. It was issued in the wake of a year-long investigation, and applies to 2021 to 2024 Bronco Sport and 2020 to 2022 Escape models with 1.5-litre engines. Canadian SUV recall from March In Canada, Ford issued related recall notices for the engine and fuel systems of certain SUVs in March of this year, which followed other advisories from 2024. One such recall, affecting 3,241 vehicles and updated on March 20, involved a risk of fire from cracked fuel injectors and recall repairs that may have been done incorrectly. That recall involved Bronco Sport models from 2021, 2022 and 2023, as well as Escape models from 2020, 2021 and 2022. Ford drivers were also advised of another recall on July 8, affecting 107,534 cars, SUVs and trucks. This related to a different issue: a potential fuel pump defect could lead to a crash.
CBC
17 hours ago
- CBC
Collision in Bancroft injures 5
Five people were injured Wednesday in a collision on Highway 28 in Bancroft, Ont., that may have been precipitated by a fallen muffler, according to Ontario Provincial Police (OPP). Officers responded to the collision around 3:30 p.m. on the highway between Bronson Road and Deltor Road, according to a news release issued Thursday morning. Two cars and a motorcycle were involved, police said. Five people from the cars were transported to hospital with injuries "ranging from minor to life-threatening," police said. The collision may have been caused by a muffler that fell off a vehicle onto the highway, police said. "The OPP wants to remind everyone to ensure proper maintenance is maintained on your vehicle and make sure items being transported are securely fastened to the vehicle," they warned. The investigation is ongoing and police are asking anyone with information or footage of the incident to contact them. The collision occurred 160 kilometres west of downtown Ottawa.
