Future job growth in the U.S. auto industry depends on supportive industrial and labour policies

As the inevitable transformation of the U.S. auto industry unfolds, supportive industrial and labour policy can help the industry reclaim its role as a source of well-paying, stable jobs, according to a report released on September 22 by the Economic Policy Institute.  “The stakes for workers in how policymakers manage the coming shift to all-electric vehicles” was written in collaboration with the BlueGreen Alliance, AFL-CIO Industrial Union Council, United Auto Workers, United Steelworkers, and The Greenlining Institute.   

Authors Jim Barrett and Josh Bivens report on the likely employment and job-quality implications of a large-scale shift to Battery Electric Vehicles (BEVs) under various scenarios. Their key findings: employment in the U.S. auto sector could rise by over 150,000 jobs in 2030 under two conditions: 1. Battery electric vehicles rise to 50% of domestic sales of autos in 2030 and 2. U.S. production of electric vehicle powertrain components increases. Supportive policies are seen to make the difference between job losses and job gains. 

The report further states: “For the auto sector to continue providing good jobs for U.S. workers, strong labor standards—including affirmative efforts to encourage unionization—will be needed. … The jobs embedded in the U.S. automobile supply chain once provided a key foundation for middle-class growth and prosperity. A cascade of poor policy decisions has eroded employment and job quality in this sector and this has helped to degrade labor standards across U.S. manufacturing and throughout the overall economy …. The industry transformation coming due to the widespread adoption of BEVs provides an opportunity to reverse these trends. The transformations necessary to ensure that this shift to BEVs supports U.S. employment and job quality—investment in advanced technology production and strengthening supply chains—will redound widely throughout manufacturing and aid growth in other sectors as well.”  

The report is summarized in “What Will It Take for Electric Vehicles to Create Jobs, Not Cut Them?” (New York Times , Sept. 22) .

How Canada can compete in the growing international battery supply chain

A  new report, Turning Talk into Action: Building Canada’s Battery Supply Chain, summarizes a forum of experts convened in March 2021 by Clean Energy Canada.  The resulting report discusses the existing state of electric vehicle and battery manufacturing in Canada, and makes a series of recommendations for action. Expert participants included the union Unifor, along with industry/employer groups: the Automotive Parts Manufacturers’ Association, The Battery Metals Association of Canada, the Delphi Group, Electric Mobility Canada, The Lion Electric Co., Dunsky Energy Consulting, Lithion Recycling, the Mining Association of Canada,  Li-Cycle, E3 Metals, the Transition Accelerator, General Motors Canada, E-One Moli Energy (Canada), Magna International, Propulsion Québec, Blue Solutions Canada, and Polaris Strategy + Insight.

The experts argue that Canada has many advantages which allow it to seize this moment of opportunity and establish itself as a major player in the global battery sector – where the global market for lithium-ion batteries is growing rapidly and expected to exceed $100 billion by 2030. Although 80 per cent of the world’s batteries are currently produced in Japan, South Korea and China, the report sets forth ideas for an industrial strategy  for an integrated North American industry, starting with an Interprovincial Battery Secretariat to bring together various provincial agencies within Canada, and an industry-led, government-supported task force to work with the Secretariat and  deliver advice by the end of 2021. With a unified battery plan in place, Canada would then be able to enter a North American Battery Alliance with the U.S., modelled on the European Battery Alliance, to leverage the existing, highly integrated automotive market and emphasizing a “clean” advantage over Asian suppliers.  Recommendations regarding the materials supply chain also emphasize sustainability and transparency in mining. Although there is already government funding available through an $8-billion NetZero Accelerator Fund, the report states that “the federal government must create a $15 billion battery supply chain fund dedicated to addressing challenges and investing in strategic projects along the Canadian value chain. The fund must be carved out specifically for the batteries versus being another stream within the Strategic Innovation Fund.”  Finally, noting that Canada already has technological and R&D expertise in batteries, the report calls for “ a government-funded, industry-led Centre of Excellence focused on commercializing advanced battery technology and manufacturing R&D. The centre would cluster university researchers, mining companies, battery manufacturers, and auto OEMs into one hub to support testing, demonstration, and the commercialization of new technologies.” Recycling would also be one of the areas included.

 The report is summarized in this Clean Energy Canada press release .  

Calls for sustainable and responsible mining for the clean energy transition

An important Special Report by the International Energy Association was released in May: The Role of Critical Minerals in Clean Energy Transitions. Reflecting a mainstream view of the importance of the raw materials for clean technologies such as electric vehicles and energy storage, the IEA provides “ a wealth of detail on mineral demand prospects under different technology and policy assumptions” , and discusses the various countries which offer supply – including Canada. The main discussion is of policies regarding supply chains, especially concerning responsible and sustainable mining, concluding with six key recommendations, including co-ordination of the many international frameworks and initiatives in the area. The report briefly recognizes the Mining Association of Canada’s Towards Sustainable Mining (TSM) protocols as internationally significant, and as one of the first to require on-site verification of its standards. The Towards Sustainable Mining (TSM) initiative was established in 2004, requiring member companies to “demonstrate leadership by reporting and independently verifying their performance in key environmental and social areas such as aboriginal and community engagement, biodiversity conservation, climate change, tailings management.”    

On May 5, the Mining Association of Canada updated one of its TSM protocols with the release a new Climate Change Protocol,  a major update to its 2013  Energy Use and GHG Emissions Management Protocol.  It is designed “to minimize the mining sector’s carbon footprint, while enhancing climate change disclosure and strengthening the sector’s ability to adapt to climate change.”  The Protocol is accompanied by a new Guide on Climate Change Adaptation for the Mining Sector,  intended for mine owners in Canada, but with global application. The Guide includes case studies of such mines as the Glencore Nickel mine in Sudbury, the notorious Giant Mine in the Northwest Territories, and the Suncor Millennium tailings pond remediation at its oil sands mine in Alberta.  The membership of MAC is a who’s who of Canadian mining and oil sands companies /  – including well-known companies such as ArcelorMittal, Barrick Gold, Glencore, Kinross,  Rio Tinto, Suncor, and Syncrude.  Other documentation, including other Frameworks and progress reports, are compiled at a dedicated Climate Change Initiatives and Innovations in the Mining Industry website.  

The demand for lithium, cobalt, nickel, and the other rare earth minerals needed for technological innovation has been embraced, not only by the mining industry, but in policy discussions –  recently, by Clean Energy Canada in its March 2021 report, The Next Frontier. The federal  ministry of Natural Resources Canada is also supportive, maintaining a Green Mining Innovation Initiative through CanmetMINING , and the government joined the U.S.-led Energy Resource Governance Initiative (ERGI) in 2019 to promote “secure and resilient supply chains for critical energy minerals.”

Alternative points of view have been pointing out the dangers inherent in the new “gold rush” mentality, since at least 2016 when Amnesty International released its 2016 expose of the use of child labour in the cobalt mines of the Democratic Republic of Congo. Most recently, in February 2021, Amnesty released Powering Change: Principles for Businesses and Governments in the Battery Value Chain, which sets out specific principles that governments and businesses should follow to avoid human rights abuses and environmental harm.  Other examples: MiningWatch Canada has posted their April 2021 webinar Green Energy, Green Mining, Green New Deal?,   which states: “The mining sector is working hard to take advantage of the climate crisis, painting mining as “green” because it supplies materials needed to support the “green” energy transition. But unless demand for both energy and materials are curtailed, environmental destruction and social conflicts will also continue to grow.”  MiningWatch Canada published  Turning Down the Heat: Can We Mine Our Way Out of the Climate Crisis? in 2020, reporting on a 2019 international conference which focused on the experience of frontline communities. Internationally, the Business & Human Rights Resource Centre maintains a Transition Minerals tracker, with ongoing data and reports concerning human and labour rights in the mining of  “transition minerals”, and also compiles links to recent reports and articles. Two recent reports in 2021:  Recharge Responsibly: The Environmental and Social Footprint of Mining Cobalt, Lithium, and Nickel for Electric Vehicle Batteries (March 2021, Earthworks) and  A Material Transition: Exploring supply and demand solutions for renewable energy minerals  from the U.K. organization War on Want.  

IndustriALL sets out union goals for decent work in the battery supply chain, organizing in Green Tech

IndustriALL Global Union represents workers along the entire battery supply chain, (except in China) through its international affiliates in  mining, chemicals, energy, electronics, and the automotive sector. Canada’s Unifor is an affiliate.  “Due diligence across the battery supply chain” (November 2020)  describes that expanding and complex supply chain, from mining to processing to end-use products for batteries, and outlines the union’s aim to research and map it. IndustriALL’s aim is to “create a social dialogue scheme or platform with key stakeholders to achieve decent work for all throughout the supply chain. IndustriALL is the only global union who can coordinate unions around the world and contribute to the policy to achieve decent work around the battery supply chain. The international trade union movement becomes more important than ever. ”  A separate post, “Developing a global trade union battery supply chain strategy”  ( November 20)  outlines further specifics about the union’s strategy and announces: “IndustriALL has applied for funding for a project starting in January 2021 on the battery supply chain across the industrial sectors. In a pilot project IndustriALL intends to collaborate with companies, NGOs and other associations to find out how such an approach can help to genuinely improve the situation workers along the entire battery supply chain.”

GreenTEch Manifesto for Mechanical Engineering

IndustriALL Global Union convened an online seminar on green technology in the mechanical engineering sector in early November 2020 – summarized here.   The seminar was the occasion to launch a  GreenTech Manifesto, which defines “Green technology” (GreenTech ) as “ any technology that promotes one or more of the 17 Sustainable Development Goals adopted by the UN summit in 2015, specifically clean water and sanitation, affordable and clean energy, green industry, innovation and infrastructure, responsible consumption and production and climate action.”

At  a previous IndustriALL workshop on Mechanical Engineering and GreenTech in December 2018, the President of Austrian trade union PRO-GE and co-chair of the sector, said: “As mechanical engineers and trade unionists, technology is the most important contribution we can make to mitigating climate change. We need hydro, we need wind, we need solar, we need biomass. And we need strong unions to ensure that energy transition is just.”

The new Greentech  Manifesto states: “IndustriALL Global Union and its affiliates need to be alert and present so that green jobs become good jobs with appropriate working and living conditions. To this end the participants at this IndustriALL Global Union GreenTech virtual workshop resolve to: § facilitate exchange between affected affiliates in the sector over new trends, especially focusing on GreenTech, digitization and related developments § organize training for trade union organizers and works councils to develop new methods, strategies and services to approach and recruit new employees at green workplaces § involve especially young workers and women in our work § intensify our efforts to increase trade union power in the affected sectors through organizing and recruiting.”

 

 

 

Ambitious focus on electric vehicles in Quebec’s 2030 Plan for a Green Economy

On November 16, the government of Quebec released its 2030 Plan for a Green Economy (in French), with an official English-language Summary.   The plan is costed at $6.7 billion over the next five years, with targets to reduce GHG emissions by 37.5% below 1990 levels by 2030, and to achieve  carbon neutrality by 2050.  The bulk of funding and attention focuses on electrification of transportation. Already a leader in electric vehicle incentives, Quebec will have the most ambitious goal for electric vehicles in Canada  –  by 2030, 1.5 million electric vehicles on the road, along with 55% of city buses and 65% of school buses, 100% of governmental cars, SUVs, vans and minivans,  and 25% of pickup trucks. Sales of new gasoline-powered vehicles will not be permitted as of 2035.

Although emissions from transportation account for 40% of the province’s total emissions, two articles posted by CBC note that the measures announced will be insufficient to meet the GHG emissions reduction targets:  “Quebec’s push to go electric won’t get province to emission reduction targets, experts say”, and “How Quebec’s climate change plan protects suburbanites from tough choices” .

The new 2030 Plan for a Green Economy is part of a suite of complementary policy statements, including  Joining Forces for a Sustainable Energy Future: 2018 – 2023 energy transition, innovation and efficiency master plan  ; Strategy for developing the Battery Sector  (French only);  and Development of critical and strategic minerals in Quebec. The complete 2030 Plan for a Green Economy is available in French only .

“Historic” investments in electric vehicles for Canada: Unifor and Ford, Fiat Chrysler agreements (updated)

In a September 28 press release, the Canadian union for auto workers, Unifor, reports that members at the Ford Motor Company voted 81% overall in favour of new three year collective agreements “that include $1.95 billion in investments to bring battery electric vehicle (BEV) production to Oakville and a new engine derivative to Windsor, along with other significant gains…. ….. This agreement is perfect timing and positions our members at the forefront of the electric vehicle transformation, as the Oakville plant will be a key BEV supplier to the North American and European Union markets”. Under the heading, “Making History in Challenging Times”, the Ford Bargaining Report Summary  reports that the retooling is scheduled to begin in 2024, with the first BEV vehicles forecasted to roll off the assembly line in 2026, “and hopefully sooner.” Also, “Through this conversion, Oakville will become the first mass production BEV plant in Canada – and one of only a few currently in North America. Ford’s investment is also the biggest single facility investment in the auto sector since 2015 in Canada.”

The Bargaining Summary highlights changes in wages, pensions, and all topics, including that the company and union agreed on the advantages of having a union Workplace Environmental Representative, and that additional training will be offered to the workplace environmental representatives “related to Global Plant Action”. Unifor and Ford also agreed to develop an Anti-Racism Action Plan, and to establish a new Racial Justice Advocate position which will offer support to those who face anti-Black and anti-Indigenous discrimination.  

Media coverage of the agreement appeared in the Toronto Star on September 20, pointing out that the federal and provincial governments will also contribute to the re-tooling of the Oakville plant.  On September 22, the Star also published “Justin Trudeau’s Liberals are betting that electric vehicles can recharge the economy. But a vision is not a plan” , summarizing some of the policy context of the decisions. And beyond the benefit to the auto manufacturing sector, on September 17,  Canada’s Minister of Natural Resources was making the case that “Mining gives Canada a competitive advantage in electric vehicle market” arguing that “we are the only nation in the western hemisphere with an abundance of cobalt, graphite, lithium and nickel, the minerals needed to make next-generation electric batteries.”

$1.5 billion investment for EV production in Fiat Chrysler agreement

Following the agreement with Ford Canada, Unifor announced the ratification of 3-year contract with Fiat Chrysler (October 19 press release), including a $1.5 billion commitment to electric vehicle production at the Windsor Ontario plant. Jerry Dias states: “This year’s Auto Talks will go down in history as a transformational moment for the Canadian auto sector. Years of government neglect, job loss and worker despair is quickly turning to optimism, hope and a very bright future.” He repeated this message in an October 20 OpEd in the Toronto StarA new green auto strategy for Canada

The Unifor summary document includes all the agreement provisions, and includes the full text of the Product and Investment Commitment Letter, describing the plans for Windsor:

“In addition to the continued production of the current Pacifica and Voyager/Grand Caravan products, including the PHEV, AWD and ICE models, FCA confirms the intention to install a new multi-energy vehicle architecture (including Plug-In Hybrid Electric (PHEV) and/or Battery Electric (BEV) capability) and at least one new model on that architecture, contingent on the necessary agreements in partnership with the Company, the Union, and both Federal and Provincial governments which includes the implementation of this collective agreement and government financial support for the associated investments. With that joint commitment, the Company’s intention is to add the necessary assembly tooling and equipment to manufacture electrified vehicles for future models, currently planned from the 2025 model year. The total impact of this investment and product plan is estimated at 5,700 secured or new jobs by 2024 returning to a 3 shift operation. Potential workforce increase of 2,000 employees over today’s active on-roll employment. Investment related to Windsor Assembly: CDN $1.35B to $1.50B.”

In addition to the headline-grabbing investment commitment for new Electric Vehicle production, the agreement also enhances training for Workplace Environmental Representatives, and increases the frequency of the existing union-management business review meetings. “The parties agree to review company product plans and business forecasts, including on electric, autonomous, connected vehicle and component parts development.”

Labour’s perspective on electric vehicles

Unifor’s Road Map for a Fair, Inclusive and Resilient Economic Recovery, published in   the summer, states: “The government must also take the lead in supporting zero-emission vehicle manufacturing and preparing the economy for electrified transportation through targeted subsidies and investment in battery technology innovation. A long-overdue National Auto Strategy, for instance, would help merge Canada’s innovation agenda, trade policy, skills training and infrastructure development to foster a modern supply chain for EV components and parts, leading to final assembly. This need not only apply to light duty, passenger vehicles but other modes of surface transportation, including mass transit, commercial trucking and logistics, student transportation, taxis and light rail. Once in place, such a strategy could serve as a rubric for all transportation sectors and industries.” 

These points are also made by Angelo DiCaro, Research Director for Unifor,  in an essay titled “Canada’s auto sector revival will take more than wishful thinking. We need a plan”, featured in the August/September issue of The Monitor, and at the Canadian Centre for Policy Alternatives website.  DiCaro reiterates the call for a national auto strategy, and sketches out key steps for a national Electric Vehicle strategy, starting with Step 1, a “comprehensive mapping of existing capacities and materials needed to forge a complete supply chain for EVs and component parts in Canada”, followed by setting domestic production targets for vehicle assembly and component manufacturing.

Union workers are strong allies for electric vehicles, as Canada’s Unifor demonstrates appeared in the industry newsletter Electrek in June 2020, quoting favourable statements re EV manufacturing from both Unifor and the United Auto Workers(UAW) in the U.S. The UAW published their report, Taking the High Road: Strategies for a fair EV Future in January, making specific policy recommendations, and stating: “The UAW rejects the idea promoted by climate change deniers that fuel efficiency and environmental regulations lead to closed plants and lost jobs. Fuel-efficient vehicles, clean energy, clean manufacturing, renewable energy and other advanced technologies are an opportunity to create new middle-class jobs with good pay, good benefits, and economic security.”

More recently,  the American Center for Progress released  “Electric Vehicles Should Be a Win for American Workers” on Sept. 23 . It concludes: “Federal funding to incentivize consumer demand, drive manufacturer investments, and build out electric vehicle infrastructure should be made contingent on key job quality and domestic content standards. In structuring funding, policymakers must be realistic about present EV capacity while also ensuring that taxpayer dollars do not subsidize low-road employers or erode job quality standards in the broader industry. By designing federal policies that encourage both rapid vehicle electrification and the creation of high-quality, good-paying domestic jobs throughout the EV ecosystem, policymakers can satisfy the priorities of climate and labor advocates and ensure economic prosperity for future generations. In a period of significant economic and environmental challenges, the transition to EVs presents a powerful and positive opportunity to improve conditions for both American workers and the climate.”

Electric vehicle policy in Canada

In response to the news of the Unifor/Ford agreement, Clean Energy Canada published a Media Brief: “What is a zero emission vehicle standard and why does Canada need one?” . It notes research from the International Council on Clean Transportation that found that Canada is the 12th largest vehicle producer in the world but  is responsible for only 0.4% of global EV production. Assessing that Canada has a EV supply problem,  Clean Energy Canada recommends a ZEV standard as the solution, rather than a voluntary standard or consumer incentives.  “A ZEV standard is a supply-focused policy that requires a gradually rising percentage of vehicles sold by auto manufacturers to be zero-emission (i.e. battery-electric, plug-in hybrid or hydrogen fuel cell vehicles). While purchase incentives help drive demand, ZEV standards secure supply.”  Currently, only British Columbia and Quebec have ZEV standards in place – with B.C. having passed the Zero Emissions Vehicle Act  in May 2019, requiring automakers to meet increasing annual levels of EV sales reaching 10% of new light-duty vehicle sales by 2025, 30% by 2030 and 100% by 2040.  On July 30, B.C. followed up with new ZEV regulations under the Act which set phased-in annual targets and other compliance requirements, as well as a ZEV advisory council to be comprised of industry, ENGOs, local governments, First Nations, infrastructure providers and academics, to provide input into the ministry’s EV programming and policies .  

The Clean Energy Media Brief links to many supporting documents, including a recent academic discussion, “Which plug-in electric vehicle policies are best? A multi-criteria evaluation framework applied to Canada”  which appeared in the June 2020 issue of Energy Research and Social Science.