Canada Contributing $447 Million Toward Ford Plant Upgrades

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With Ford and Unifor having agreed to a new three-year contract last month, Oakville Assembly (which currently manufacturers the Ford Edge and Lincoln Nautilus) is slated to be retooled to manufacturer electric vehicles and their batteries. While the first example wouldn’t roll off the assembly line until 2026, according to the agreement, Canada is excited about the prospect of green jobs. In fact, the Canadian government has committed itself to an ambitious program aimed at boosting electric vehicle sales in order to achieve net-zero carbon emissions by 2050.

We’re always suspect of central planning, as regulatory changes often have unintended consequences for the associated industries, but need to praise Canada for actually putting some money where its mouth is. Barring a mishap in 2023, the nation has promised to contribute $447 million (split evenly between the Ontario and federal governments) toward Ford’s 1.4-billion program to convert the facility.

Unifor seems pleased enough. President Jerry Dias has repeatedly said the union would need substantial and consistent support from the Canadian government if the nation expects to remain a major manufacturing hub  especially as the industry seems bent on transitioning toward EVs. While that has not been reflected in consumer behaviors, the industry itself has invested more than enough money into electrification and numerous markets are regulating the industry to ensure this happens. They’re poised for a change, regardless of what the markets want to do.

“Both governments understand where the industry is heading. You either get on board now or get lost in the shuffle,” Dias said in an interview with Automotive News Canada. “They understand this is a pivotal time for the industry.”

Canadian Prime Minister Justin Trudeau participated in Thursday’s event announcing the government-backed funding via the internet, saying this would be the first of many steps toward a ” next-generation auto industry.”

“Today’s investment from Ford Canada is historic. It will ensure our province continues to lead North America and the world in automotive manufacturing and innovation, while boosting our competitiveness in this key sector,” Trudeau continued.

Based on the updated contract agreement, Oakville intends on continuing the production of the Edge and Nautilus until 2023. Originally, Blue Oval had no future plans for the facility (a historic building manufacturing Ford products since 1953) and looked to be shuttering it once production wrapped on the current batch of middleweight crossovers. But the agreement with Unifor has effectively breathed new life into the site, with a few very important stipulations.

Retooling the factory and getting those government investments comes after the latest contract expires. That means this whole deal could fall apart long before Oakville gets its upgrade and the issue will undoubtedly come up in union negotiations slated for 2023. For now, Ford seems happy enough to play along and we doubt the Canadian government offering to foot a significant portion of the bill is going to endanger that position.

“With the support of the federal and provincial government, Ford of Canada is investing in the future of its Ontario-based operations, solidifying its commitment to providing thousands of well-paying jobs in Ontario and becoming the first automaker in the country to build full battery-electric vehicles while delivering operational improvements that will maximize production flexibility to ensure we remain operationally competitive,” Ford Canada CEO Dean Stoneley said in a statement.

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