“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.  

Ontario investing in transit, vehicle R & D

GO transit stationOn March 31, the Government of Ontario announced  that it will invest  $13.5 billion in the GO Regional Express Rail  project – expanding the existing GO commuter rail system in the Toronto-Hamilton area by building 12 new stations and  increasing  the frequency of service. This expansion will also include  creating a “transportation hub” at  the western terminus of the Toronto subway, according to a subsequent announcement on April 3 .  The goal is to increase the number of weekly trips across the GO train network from 1,500 today to roughly 6,000 by 2025.   The federal government will also contribute more than $1.8 billion to the GO Transit Regional Express rail project, using  funds from the Harper-era  New Building Canada Fund – Provincial-Territorial Infrastructure Component.   A further $200 million has been committed to 312 projects across Ontario through the Public Transit Infrastructure Fund  . Click here  for a list of Ontario projects. Click here for the corporate explanation of the Regional Express Rail project.

Newmarket – a bedroom community of the Toronto area – announced  on March 27 that it will be part of  the Pan-Ontario Electric Bus Demonstration and Integration Trial, joining another GTA suburb, Brampton, already enrolled.  Newmarket will purchase six electric powered heavy-duty transit buses – four  from New Flyer Industries of Winnipeg, Manitoba and two more from Nova Bus, of St. Eustache, Quebec. Overhead-charging stations will be designed and manufactured by Siemens and ABBGroup. The local utility,  Newmarket-TayPower Distribution Limited, will  purchase and operate an on-route charging station.  The initiative is the result of a partnership between the municipality, the utility, and the Canadian Urban Transit Research and Innovation Consortium (CUTRIC)  , incorporated in August 2014 to support industry-academic collaborations to develop next generation technologies for Canadian transit and transportation systems.

In another press release , the government of Ontario announced a joint partnership with the federal government and Ford Motor Company of Canada, providing Ford with a conditional grant of up to $102.4 million to establish an advanced manufacturing program at its Windsor plant. According to the press release, “the investment will create 300 new jobs at Ford operations in Ontario and protect hundreds more.”  Ford will also establish a Research and Engineering Centre in Ottawa, employing engineers and scientists  to focus on infotainment, in-vehicle modems, gateway modules, driver-assist features and autonomous vehicles.

Small steps for the miners behind electric vehicles and smart phones

Cobalt is a key ingredient in the lithium-ion batteries that power smartphones, laptops and electric cars. 60% of the world’s supply is mined in  Congo, according to “The Cobalt Pipeline” (September 2016),  a Washington Post special report which documented the appalling working conditions of the “artisanal miners”.  Occupational health and safety concerns for  miners was also  expressed in  “The Battery Revolution is exciting, but Remember they Pollute too”, by Carla Lipsig Mumme and Caleb Goods in The Conversation (June 2015).

In a December 20 article,  the Washington Post reports on two new initiatives to curb “the worst forms of child labor” and other abusive workplace practices in the supply chain for cobalt. The first, the Responsible Cobalt Initiative, is being  led by  the Chinese Chamber of Commerce for Metals, Minerals and Chemicals Importers and Exporters, and supported by the Organization for Economic Cooperation and Development (OECD), with members pledging to follow OECD guidelines  which call for companies to trace how cobalt is being extracted, transported, manufactured and sold. Apple, HP, Samsung SDI and Sony have signed on.

The second initiative, the Responsible Raw Materials Initiative (RRMI) has been launched by the Electronic Industry Citizenship Coalition , a nonprofit group sponsored by more than 110  electronics companies, and  “dedicated to improving the social, environmental and ethical conditions of their global supply chains.” The EICC states that it “engages regularly with dozens of non-member organizations including civil society groups, trade unions and other worker’s groups, academia and research institutions, socially responsible investors, and governmental and multilateral institutions.”  Ford Motor Company is a member of the Responsible Raw Materials Initiative, by virtue of being the first auto manufacturer to join the EICC. ( Press release is here (February 2016). Ford has sought to brand itself as a leader in ethical supply chain management   ; see their report,  Going Further towards Supply Chain Leadership . Tesla, the most high-profile electric vehicle manufacturer, is said to be considering membership in the RRMI. According to a report from Energy Mix (June 24, 2016) “Tesla’s Ambitions Demand ‘Unprecedented Quantities’ of Key Minerals” , including lithium, nickel, cobalt, and aluminum to produce vehicle batteries.  As of January 2017, Energy Mix also reported  that  Tesla started mass production at its lithium-ion battery Gigafactory in Nevada, which will be the world’s largest when it is complete in 2018 .

tesla-gigafactory

Tesla Gigafactory, Nevada.  Photo from the Tesla website .