Unifor wants Canada’s auto strategy built around EVs

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Unifor is urging Canada’s government to implement a national auto strategy built around the adoption and manufacturing of zero-emissions electric vehicles.

“The government must accelerate the conversion of passenger and commercial vehicles to ZEVs by providing financial support and tax credits to firms engaged in the manufacture of EVs, for instance, including final assembly and the production of EV component parts in Canada,” the union wrote in a report released Wednesday.

Its proposals, Unifor says, would lead to a “fair, inclusive and resilient” economic recovery.

Unifor, Canada’s largest private-sector union, representing about 315,000 workers in every major area of the economy, also urged Ottawa to boost skills training and raise the federal minimum wage to at least C$15 per hour ($11 USD). It said any corporate rescue packages should come with “strong, enforceable conditions,” including job protection guarantees, executive compensation limits and the adoption of union neutrality stances.

The proposals come as the federal and provincial governments begin to turn their attention to long-term economic recovery from the COVID-19 crisis while attempting to keep new cases from spiking. The national unemployment rate rose in May to a record 13.7 percent, according to Statistics Canada.

The proposals also come as Unifor prepares for contract negotiations with the Detroit 3 automakers later this year. Those talks will likely revolve around long-term production commitments following the end of vehicle assembly at General Motors’ Oshawa plant in 2019 and uncertainty surrounding production plans at Ford Motor Co.’s Oakville plant beyond 2023.

EV promotion

If the union’s proposals are an indication, Unifor sees EV production as a way to stabilize and grow Canada’s auto manufacturing footprint. Unifor said any “long-overdue” national auto strategy should serve to “promote sustainable growth, attract investment and expand… the industry’s production capacity across the domestic supply chain.”

The country’s EV strategy should also include “targeted subsidies and investment” in battery technologies, consumer incentives to spur EV adoption and the development of a fast-charging network, the union said.

“Government support, however, must be accompanied by firm commitments to hold large companies such as automakers to account,” the document reads. “This matter is of particular concern when automakers profess their interest in manufacturing green technology such as electric vehicles … but simultaneously shift production to low-wage jurisdictions, while dragging their feet on domestic EV investment.”

Bailout conditions

Unifor said the federal government should institute stronger conditions on any bailout packages that are doled out in the future than it did during the 2008-09 financial crisis. The union criticized the federal and Ontario governments’ approach to rescuing GM and Chrysler in 2009, saying the governments should have held on to their stakes in the companies for longer as a way to protect existing jobs and urge investments in Canadian manufacturing.

“Clearly, it was a short-sighted decision by both the federal and Ontario governments to sell their equity stakes in GM and Chrysler as the industry recovered,” the union said. “Governments could have leveraged the power they held as shareholders to entice further investment in the Canadian auto industry. Instead, they used the proceeds to balance their own budgets.”

The union said the government should draw lessons from the auto bailouts by ensuring that rescue packages are limited to include debt instruments or equity purchases, establish “job protection guarantees,” prevent wage reductions and “require investments in productive capacity in Canada” for “a pre-determined period” of time.

Higher minimum wage

As part of its plans to promote income security in Canada, Unifor proposed raising the federal minimum wage to 60 percent of the median hourly wage of full-time workers, though no less than $15 per hour. It said increases in the minimum wage should then be tied annually to either the Consumer Price Index or the national average annual wage increase, depending on which is higher.

That proposal is likely to draw the ire of some auto manufacturers in Canada, which have argued against minimum wage increases in the past. Suppliers, including Magna International Inc., opposed an Ontario law passed in 2017 that would have gradually raised the minimum wage in the province to $15 per hour from $11.60.

Magna executives said it would force the company to increase their own wages and would make manufacturing in Ontario more costly. Following an election in 2018, the province froze its minimum wage at $14 per hour, though it is set to rise in October o $14.25 per hour.

Four-day work week

Among other proposals, Unifor urged the federal government to work with employers and unions to “build stability and balance into the lives of workers,” proposing measures that “can include” a four-day work week, providing more vacation time and adding more personal days.

“The current economic crisis will almost certainly prove to be the worst economic downturn in modern history,” the union said. “The response to this crisis must be equally unprecedented in order to stave off the worst effects a downturn can bring. The devastation of the COVID-19 pandemic had opened many eyes to the inequality and unfairness that is at the root of our current economic system.”

Unifor President Jerry Dias and other union officials were set to hold a press conference Wednesday afternoon to discuss their proposals. Automotive News Canada obtained an embargoed copy of the report ahead of its official release.

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Saurabh Shukla

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