Capitulation is never a pretty sight; however, Mark Carney refuses to get tough, even undoing counter-tariffs that he had imposed against the United States. The conclusion I draw is that we are giving up the fight. The soothing promise of better relations in the future with Trump (i.e., a renegotiation of the CUSMA agreement) seems to be the justification for our meekness, but there is nothing at all to suggest a winning strategy is at play here.
Jim Stanford says it doesn't have to be this way. The insufferable insistence by the U.S. that they alone will manufacture North American automobiles cannot be allowed to stand, and Stellantis's announcement that it will commit to a $13-billion American expansion at the expense of its Brampton works demands a strong Canadian response.
[T]he sheer gall of Stellantis’ action is shocking. It is breaking explicit commitments made to all its key partners: its own workers (in a binding labour contract), the federal and provincial governments (in binding covenants attached to various subsidies), and auto parts companies (which invested hundreds of millions in new tooling and capital for Brampton).
Despite the fact that our auto exports to the U.S. are down considerably, Stanford warns of something even worse:
If corporations respond to Trump’s extortion by shifting long-run investment to the U.S., Canada’s industrial capacity will be destroyed.
That’s why the Stellantis decision cannot stand. It would set a precedent that quickly spreads into all other high-tech industries.
It’s no coincidence these 232 tariffs are aimed at every one of Canada’s high-tech success stories: auto, trucks, steel and other basic metals, soon to be joined by aerospace, pharmaceuticals, semiconductors, industrial machinery and more.
Strong government action is required:
Last year Stellantis sold 130,000 new vehicles here — most imported, most of those from the U.S. At present Stellantis mostly avoids Canada’s 25 per cent counter-tariff on vehicle imports from the U.S., thanks to a clever Canadian duty remission program.
Ottawa should threaten full 25 per cent tariffs on all Stellantis imports (costing $1.5 billion per year), until it recommits to completing the tooling at Brampton, paying interim income support to its workforce and then fully utilizing the plant when it’s finished.
Pushing back against Stellantis will send a signal to companies in every other high-tech industry. If you want access to Canada’s market, Canada’s resources and Canada’s supply chains, you must maintain a full-fledged production footprint here.
That Stellantis made such the decision it did is a testament to the abject failure of the Carney government's appeasement efforts, which included
multiple concessions and personal flattery. While we talk nice, [Trump] races full-speed to steal as many high-tech, high-wage jobs as he can.
I read this morning that Industry Minister Melanie Joly summoned Stellantis to Ottawa to explain itself. I'm sure she gave them a stern talking to, and threatened unspecified 'consequences'. However, since the Carney government has raised appeasement to a national level, I have my deep doubts whether anything substantive will be done, and people like Jim Stanford will likely find that his strong, sound advice will be not be taken under advisement.
