Linamar deal a good start, but Canada needs a comprehensive auto strategy

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Photo: flickr/FredericRivollier

The Canadian and Ontario governments plan to make a joint investment of $100 million in Guelph area auto manufacturer Linamar, with the hopes of creating some 12,000 jobs.

Ontario Premier Kathleen Wynne and Transportation Minister Lisa Raitt made the announcement Monday morning while touring Linamar plants.

With more than 20 manufacturing plants in the city, Linamar is Guelph's largest private sector employer and is not currently unionized.

"We applaud any investment by provincial and federal governments that builds the auto parts industry in Ontario," said Fergo Berto, Auto Parts Coordinator at Unifor, which represents over 38,000 workers in the auto sector.

"We hope someday that Linamar workers will see the benefits of joining Unifor, but we still applaud the investment if it's creating good paying jobs."

Berto added that he hoped to see similar investments made in auto assembly facilities, without which the auto parts industry could not grow.

"Government support for a key industry like auto is important, despite the fact that it is a non-unionized company," says Shane Wark, Assistant to Unifor's President Jerry Dias.

However, Wark adds, "these investments seem to be coming on an ad hoc basis and we've been pushing for a comprehensive auto investment strategy."

Unifor has long advocated the need for an integrated auto policy in Canada to help boost investment in the lagging industry.

At the industry's peak, Canada was the fourth largest auto producer in the world, but the industry has lost approximately one third of its manufacturing footprint and almost 50,000 jobs due to a gradual southern migration of auto investment to Mexico and the southern United States.

Canadian and U.S. auto sales have strengthened significantly from the 2008 recession lows, yet Canada has received less than ten per cent of the total investments made by automakers in the North America market.

Major government subsidies have become standard practice for countries looking to court investment, along with preferential tax treatment. Last October, Canada's auto industry lost a major investment to Mexico when the federal and Ontario governments decided that they would not meet Ford's $700 million investment requirement to manufacture 1.5 and 1.6 Litre engines in Windsor, Ontario.

In Monday's press conference, Raitt said that the new investment will "ensure that Linamar's total investment of over half-a-billion dollars stays right here in Canada."

The governments' contributions will augment the $400 million that Linamar has pledged to invest in research and development of more fuel-efficient and environmentally friendly cars.

In addition to creating new jobs over the next ten years, the Linamar project is expected to maintain over 6,800 jobs in Ontario.

Ella Bedard is's labour intern. She has written about labour issues for and the Halifax Media Co-op and is the co-producer of the radio documentary The Amelie: Canadian Refugee Policy and the Story of the 1987 Boat People. She now lives in Toronto

Photo: flickr/FredericRivollier

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