Ottawa seeks auto investment: minister
Ottawa seeks auto investment: minister Federal Industry Minister Christian Paradis says Ottawa remains committed to courting new auto assembly work, despite concerns that more needs to be done. “We have to make sure that we can create a good environment to attract investment from the companies,” he said on the sidelines of the North American International Auto Show in Detroit. He said that includes leveraging a relatively low tax rate, skilled workforce, and other measures, including immigration reforms that will ease further investment. Paradis said he also believed the recently announced extension of the $250-million Automotive Innovation Fund would help achieve those goals. Such incentives have become the cost of Canada continuing to participate in the auto sector in recent years as other jurisdictions, including the Southern U.S. and Mexico, ramp up their own government aid to court the same work. Paradis said Ottawa has held discussions with most of the automakers that produce vehicles in the country about potentially tapping the recently renewed AIF. But he also confirmed Ottawa is in active negotiations with Ford Motor Co. of Canada about a possible investment in its plant in Oakville, Ont., with the goal of courting a new global platform there. "As we speak, we are in negotiations. This is a partnership for the project. Ontario is involved, we are involved," he said. "We committed to Ford that we are serious in this project and we’re happy to look at it." He would not confirm the amount Ford was seeking in government aid. But Ford is reportedly asking for roughly a third of the $1.2-billion development cost of the project to come through federal and provincial aid. Paradis said the funding for Ford would likely come from the AIF. But he said he wasn’t concerned that much of the fund would be drawn for the project if it goes ahead and that increasing the fund was not being considered. Despite billions of federal and provincial dollars being spent over the years on similar incentives and the bailouts of General Motors Co. and Chrysler in 2009, there has been a steady bleed of assembly jobs to other, less expensive jurisdictions. All three Detroit automakers said this week at the Detroit Auto Show they continue to have concerns about the cost of producing vehicles in Canada, which they argue remains the most expensive jurisdiction in the world to produce their vehicles despite the concessions that were won from the Canadian Auto Workers this fall. In recent years, this has seen Ford close its St. Thomas plant, and last month contributed to GM saying it would halt the production of its Camaro in Oshawa, Ont., once the current model goes out of production expected sometime in 2015.
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