GM Oshawa closure – a sign of the disruption to auto manufacturing

chevy boltAfter the November 26 bombshell announcement that the GM plant in Oshawa will close at the end of December 2019, Unifor President Jerry Diaz has demanded that GM allocate product to the Oshawa plant, putting his faith in the newly-signed USMCA trade agreement and stating  “Oshawa has been in this situation before with no product on the horizon and we were able to successfully make the case for continued operations.”  But in a CBC interview, “Why can’t they make the future in Oshawa?‘”(Nov. 27),  the Canadian Vice President for Corporate and Environmental Affairs states firmly that there is no hope for further production in Oshawa.  “This decision has to do with simply being able to make the transition to the future and reallocate capital into the massive investments that are needed for electric vehicles and autonomous vehicles.” He forecasts that about half of the existing Oshawa workers will be eligible to retire with enhanced full pensions, some (but not all) others may find work at GM plants in Ingersoll or St. Catharines, and the rest will be covered by whatever compensation, benefits and timing is negotiated with their union, Unifor.  In a more recent CBC article, “GM Canada president says electric vehicles are the future — but they won’t be made in Oshawa” (Dec. 4), the president reiterates that there are no changes planned for the CAMI plant in Ingersoll or the St. Catharines facility, and points to the growth of the new GM Canadian Technology Centre opened in Markham in January 2018, which has already hired approximately 450 software engineers and coders, with plans to hire more.

Although Ontario Premier Ford somehow blamed the previous government’s cap and trade policies for GM’s decision, others are recognizing the GM closure as part of the disruption and transformation of the auto industry.   From the Energy Mix, “GM Plant Closure Shows Industry Transition Catching Canada, Ontario Flat-Footed” (Nov. 30) ; (also of interest: “Lost Opportunities Show Cost of Canada’s Moribund Cleantech Manufacturing Strategy”   (Nov. 30), which discusses the dilemma of electric bus manufacturers in Canada).  In “GM and Canada’s transition to a zero-emissions fleet”  in IRPP Policy Options (Dec. 3) , author  Ryan Katz-Rosene of the University of Ottawa  states that  “ the 20th-century auto-sector model (in which a handful of global automakers commanded the market and much of the supply chain associated with it) is pretty much dead now.” The article asks, “Where does this leave Canada in terms of its preparedness to participate in the 21st century automobile sector, which is largely centred on electric and autonomous vehicles? And, what role (if any) should governments, at all levels, play to improve Canada’s industrial positioning in that sector?”   And Barry Cross of Queen’s University asks “Have we reached peak car?” in The Conversation (Dec. 2) – a quick view of the future of autonomous vehicles and car sharing.

Good news and bad news about electric vehicles: B.C. mandates, Oshawa plant closing

Electric vehicles Wikimedia Commons 768x512The Good News: British Columbia:   In the latest encouragement to electric vehicle ownership in British Columbia, the Premier announced on November 20  that he will introduce legislation in Spring 2019 to phase in targets for the sale of zero-emission vehicles in the province –  10% ZEV sales by 2025, 30% by 2030, and 100% by 2040.  This will be accompanied by funding to expand charging infrastructure, and for consumer incentives in addition to the existing incentives under the Clean Energy Vehicle program . The new policies are  in line with the Intentions Paper on Transportation,  part of a public consultation in Summer 2018.  (For background, read  “Fuelled by strong demand, B.C. adds $10 million to electric vehicle incentive program” (Sept 27) and “B.C. proposes mandate for electric vehicles”  (July 27), both in the National Observer.) Mandates for EV sales are already in place in Quebec, California, and other U.S. states.

gm oshawaThe Bad news: Ontario:  Mandates for EV sales in the U.S. was part of the modernization strategy  by General Motors in its comments  to the U.S. government under the  Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule on October 26, 2018.  According to the  National Observer  at the time, “Transport Canada welcomes GM’s electric car plan”. Apparently, Transport Canada didn’t know what was in store.  As of November 26, GM’s  global modernization strategy came crashing down on Ontario auto workers – announced in the November 26 corporate press release:  GM Accelerates Transformation . The brief and unexpected press release names the GM Assembly plant in Oshawa Ontario as one which will be “unallocated” in 2019, along with  Detroit-Hamtramck Assembly ( Detroit) and Lordstown Assembly (Warren, Ohio). The Toronto Star makes the connections in “GM plant closure in Oshawa part of company’s shift to electric, self-driving autos”   (Nov. 26) .

Unifor, which represents approximately 2,500 GM Oshawa workers who will lose their jobs, was only informed of the decision one day ahead of the public announcement, and has stated  : “Based on commitments made during 2016 contract negotiations, Unifor does not accept this announcement and is immediately calling on GM to live up to the spirit of that agreement.”  Ontario’s Premier Ford issued a statement  saying: “As a first step, I will be authorizing Employment Ontario to deploy its Rapid Re-Employment and Training Services program to provide impacted local workers with targeted local training and jobs services to help them regain employment as quickly as possible….we are asking the federal government to immediately extend Employment Insurance (EI) eligibility to ensure impacted workers in the auto sector can fully access EI benefits when they need them most….We are also asking the federal government to work with their U.S. counterparts to remove all tariffs so that impacted auto parts suppliers can remain competitive after the Oshawa Assembly Plant closes its doors.”

 

 

Extended Producer Responsibility reduces waste and impacts the workplace

Cutting the wasteThe October 16  report from the Ecofiscal Commission ,  Cutting the Waste: How to save money while improving our solid waste systems  is a thorough examination of the issue of waste management in Canada, and while it discusses consumer behaviour (including single use plastics, briefly), the main focus is on municipal programs of disposal pricing ( tipping fees and  “pay as you throw”)  and Extended Producer Responsibility (EPR).

Extended Producer Responsibility (EPR) programs shift the costs and responsibility for waste management from taxpayers and consumers to manufacturers.  Cutting the Waste  recommends expanding and harmonizing Canada’s EPR programs, stating…. “ “extended producer responsibility” programs … can improve the efficiency of recycling programs while also creating incentives to produce goods that generate less waste or goods that can more easily be recycled.”  The report provides a good overview of the history, structure, and efficiency of EPR programs in Canada, stating that there are over 120 such programs (both voluntary and legislated) in Canada, following an EPR Action Plan which was  developed through the Canadian Council of Ministers of the Environment (CCME) in 2009. Their most recent progress report on the Action Plan was conducted in 2014 .  The Ecofiscal Commission highlights British Columbia as having the most stringent and comprehensive plan, and states, “Alberta is the only province that does not have legislated extended producer responsibility (EPR) programs and is falling behind in its commitments under the Canada-wide Action Plan for EPR.”  EPR Canada , a non-profit association, also publishes Report Cards – their most recent was released in 2017.

How does waste management translate into a greener workplace?  The automobile manufacturing industry provides a Canadian example, and in its 2011 Fact Sheet  “Taking Back our Jobs – Taking Back our Environment “ , the Canadian Auto Workers endorsed EPR, with concise arguments,  stating “The future job creation potential is enormous. The motor vehicle industry is one of the best examples of EPR job creation.”   (The Fact Sheet was republished by Unifor in 2013,  here).  From the company, the GM Landfill-free Blueprint (2018) makes a business case for reducing waste and includes the concept of employee engagement.

In September 2018 , one of  Canada’s Clean50 awards for 2019 went to the General Motors Assembly plant in Oshawa Ontario for its “zero waste to landfill” project   .  The announcement states:   “At the core of the success of General Motors Landfill-Free Project at GM Oshawa Assembly Plant initiative lies the fact that the “team” for this project numbers approximately 3,000.  …. it was the employees at the plant who were directly and indirectly part of the successful implementation of their project.”

According to a GM press ( February 2018) ,GM is now diverting 100 per cent waste from landfills at all Canadian manufacturing facilities;  St. Catharines Propulsion facility since 2008,  and CAMI Assembly since 2014.  The St. Catharines facility is also the proposed site of  Ontario’s first complete renewable landfill gas industrial co-generation system, which will use landfill gas from an offsite source, delivered via pipeline, to generate electricity and  reduce the greenhouse gas emissions from the plant by more than 77 per cent. More details are here .  A caveat: although this project was projected to come online in mid-2019, it  was initiated under the previous Liberal government,  funded by cap and trade revenues through GreenON Industries, which is one of the programs cancelled by the current Conservative government.

Canada launches consultation on vehicle emissions regulations under cloud of Trump rollbacks

pick up truckOn August 20, Canada’s Minister of Environment and Climate Change published a Discussion Paper  to launch consultations on the mid-term evaluation of Canada’s light-duty vehicle greenhouse gas emission regulations for the 2022–2025 model years.  Public comments may be submitted to ec.infovehiculeetmoteur-vehicleandengineinfo.ec@canada.ca by September 28, 2018. Once comments have been reviewed, if the government determines that regulatory changes are needed, it promises a second consultation period.  One of the first off the mark with a response: Clean Energy Canada, with “Canada should explore stronger vehicle standards to cut pollution and enhance competitiveness” .

The mid-term review is required by the 2014 regulations under which Canada currently operates, but it comes at a time when Canada must decide whether to continue to align its fuel efficiency standards with the U.S., as it has done for 20 years, or follow its own path.  The current Canadian trajectory is shaped by our GHG reduction commitments under the Paris Agreement, the Pan-Canadian Framework for Clean Growth and Climate Change  , and a 2017 commitment  to develop a  national Zero-Emissions Vehicle Strategy by 2018.

But in the  U.S. ,  on August 2, the Trump administration announced the Safer Affordable Fuel Efficient Vehicle Rule (SAFER) , which proposes weakening the EPA’s greenhouse gas emissions standards and Department of Transportation’s Corporate Average Fuel Economy (CAFE) standards for light duty vehicles in model years 2021 through 2025. The proposed rule  would also revoke a legal waiver which allows California and 13 other states to set their own pollution standards. Based on arguments made in the document  Make Cars Great Again , published by the Wall Street Journal, the Trump plan claims it will save $500 billion in “societal costs,” avert thousands of highway fatalities and save consumers an estimated $2,340 on each new automobile.   Most of the Administration’s arguments are refuted in  “Five Important points about the Safe Vehicle Rule”  by the Sabin School of Law at Columbia University. Other critiques: from Vox: “Trump is freezing Obama’s fuel economy standards. Here’s what that could do”  (Aug. 2); and “The EPA refuted its own bizarre justification for rolling back fuel efficiency standards” (Aug. 16);  “Trump administration to freeze fuel-efficiency requirements in move likely to spur legal battle with states” in the Washington Post (Aug. 2)  ; “Trump’s Auto Efficiency Rollback: Losing the Climate Fight, 1 MPG at a Time” by Inside Climate News (Aug. 2) .

What should Canada do? Technical analysis comes in   Automobile production in Canada and implications for Canada’s 2025 passenger vehicle greenhouse gas standards, released by the International Council on Clean Transportation in April 2018, which analyzes the Canadian vehicle manufacturing market and sales patterns and describes the possible impacts if Canada  aligns weakens its greenhouse gas emission standards with the Trump administration,  or maintains its existing standards and aligns with California.  Other opinions: From Clean Energy Canada on Aug. 2 ,  “Canada should hold firm and reject Trump’s efforts to roll back vehicle standards” ;  or “On vehicle emissions standards It’s time Canada divorced the United States”   in Policy Options (April 2018); and  “Trump’s plan to scare Americans into supporting car pollution” in the National Observer (Aug. 7) .

U.K. government releases strategy to reduce transportation emissions, stimulate clean vehicle manufacturing

The U.K. Committee on Climate Change (CCC) submitted its 2018 annual report to the British Parliament on June 28, marking ten years since the Climate Change Act became law in 2008.  On the plus side, the report highlights a decoupling of economic  growth:   since 1990, emissions have fallen by 43% and the economy has grown by over 70%. Since 2008, the UK has achieved a 59% reduction in emissions from electricity generation. Yet despite that progress, other sectors, notably transport, agriculture and the built environment, have not achieved reductions – transport emissions have actually grown and at  28% of total UK emissions, are now the single largest emitter.    Reducing UK emissions – 2018 Progress Report to Parliament  outlines four high-level, messages for government and calls for immediate policy action in residential energy efficiency, development of Carbon Capture and Storage, and stronger consumer  incentives for electric vehicles.

black cabsNo sooner said than done: on July 9, the British Ministry of Transport  released  a long-awaiting document, The Road to Zero Strategy , with the goal that all new cars and vans will be effectively zero emission by 2040, at which time the government will end the sale of new conventional gas and diesel cars and vans. The press release highlights and summarizes the proposals .  Some specifics: commitment to continue consumer purchase incentives for plug-in cars, vans, taxis and motorcycles; commitment that all  the central Government car fleet will be zero emissions by 2030; the  launch of a £400 million Charging Infrastructure Investment Fund and  as much as £500 incentive for  electric vehicle owners to help them install a charge point at their home; increasing the grant level of the existing incentives for Workplace Charging stations.

Stimulating the motor vehicle industry:  Notably, the strategy aims to improve emissions in road transport in the U.K. while putting the U.K.  “at the forefront of the design and manufacturing of zero emission vehicles.”  Measures announced to support industry include: public investment in auto technology R & D, including £246 million to research next generation battery technology; and  working with the industry training group,  Institute of the Motor Industry,  “to ensure the UK’s workforce of mechanics are well trained and have the skills they need to repair these vehicles safely, delivering for consumers” .

However, “Road to Zero or Road to Nowhere: Government revs up green vehicle ‘ambition’ ”  in Business Green newsletter compiles reaction from business and environmental sources, all of which agree that the 2040 target date is too late. The quote from the Policy Director of Green Alliance sums up reaction:  “It’s rare for the oil industry, mayors and environmentalists to agree on something, but we all think 2040 is far too late for a ban on conventional vehicles…Moving it to 2030 and setting a zero emissions vehicles mandate would encourage car companies to build electric cars in the UK, and give the country a head start on its competitors across Europe. While there are some welcome measures, including on charging infrastructure, the Road to Zero strategy is on cruise control. As it stands, it won’t help the UK build a world leading clean automotive industry.”

The full Road to Zero policy document is here ; the accompanying technical report,  Transport Energy Model   provides data about the GHG emissions, energy requirements, and pollution associated with cars, trucks and double decker buses using conventional fossil fuels as well as biofuels, hydrogen, and electricity.