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Ontario tries to allay auto sector fears over climate change plan

DMC-Orangeville

85D and John Deere 5100E
Feb 14, 2015
942
1,175
Orangeville ON Canada
"Statistics show that Canada is already the third choice among NAFTA countries when it comes to new automotive investment."
.....after USA and Mexico..........and why is that?
1. Extremely high cost of doing business in Canada ( red tape, government intervention, indifference to business)
2. High cost of Canadian labour and ease of unionization
3. Risk of significant increase in both corporate and personal taxation with current governments

Manufacturing in this province is in deep trouble and will continue to falter. While the USA is reshoring its' manufacturing base, Canada continues to lose.

Elon left Canada for a reason.........
 
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You forgot to mention the ridiculous electricity rates.
I see this claim a lot, but I never see the actual rates posted, so I'm curious what the actual rates are in different jurisdictions.

In Kelowna, I receive a bill every 2 months. It consists of:
  1. Basic Customer Charge (60 days): $31.23
  2. Energy Used Block 1: 1,600 kWh @ $0.09845/kWh
  3. Energy Used Block 2: (over 1600 kWh in the 60 day period)@ $0.15198/kWh

The rates recently increased by about 10%.

I don't know if there are additional Energy Blocks. Even without a Tesla we always reached into Energy Block 2 in a 60 day billing cycle.

Edit: Add 5% GST to the total bill.
 
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wayner

Active Member
Oct 29, 2014
3,883
1,474
Toronto
Considering the Ontario grid is one of the cleanest (in terms of CO2) in the world, and the nearest US grid neighbour is 10x worse, and it's not like we're struggling in the dark here.... I don't see the problem.
I agree, and most areas have TOU pricing so there are ways of dealing with the high rates. The off-peak rates are now $0.087 from 7pm-7am so all in that is probably around $0.13. And overnight the carbon intensity of the Ontario grid is really quite low, often < 10g/kWh since there would only be a few NatGas plants running at that time. Even during the day it is pretty low since the bulk of the power comes from nukes and hydro.

And Teslas, and other EVs, get green plates which let them use HOV lanes (at least for another few weeks).

And if you want to install solar panels to (indirectly) fuel your car Ontario has the MicroFIT program which is (or at least was) a pretty good incentive compared to most jurisdictions - although that has become a lot less attractive in 2016.
 
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wayner

Active Member
Oct 29, 2014
3,883
1,474
Toronto
"Statistics show that Canada is already the third choice among NAFTA countries when it comes to new automotive investment."
.....after USA and Mexico..........and why is that?
1. Extremely high cost of doing business in Canada ( red tape, government intervention, indifference to business)
2. High cost of Canadian labour and ease of unionization
3. Risk of significant increase in both corporate and personal taxation with current governments

Manufacturing in this province is in deep trouble and will continue to falter. While the USA is reshoring its' manufacturing base, Canada continues to lose.
I think your view is a little overly simplistic. I have some experience with a business that operates in California and it is a VERY expensive jurisdiction to operate that is extremely friendly to labour unions, is unfriendly to business and has relatively high taxes compared to other states. And yet Tesla chose to locate there.

In fact you could do a Search/Replace of Canada with California and your statements would still ring true.
 
And if you want to install solar panels to (indirectly) fuel your car Ontario has the MicroFIT program which is (or at least was) a pretty good incentive compared to most jurisdictions - although that has become a lot less attractive in 2016.
While on the surface the program may look less attactive in 2016, the cost of the installations has reduced a similar percentage as the guaranteed contract rates.
 

wayner

Active Member
Oct 29, 2014
3,883
1,474
Toronto
While on the surface the program may look less attactive in 2016, the cost of the installations has reduced a similar percentage as the guaranteed contract rates.
While that is true over the last five years or so, I don't know that it is true in the last year as the rate went from $0.384 to $0.294 from 2015-6 and my understanding is that panel (and other hardware) costs went up due to the fall in the Canadian dollar.
 

DMC-Orangeville

85D and John Deere 5100E
Feb 14, 2015
942
1,175
Orangeville ON Canada
I think your view is a little overly simplistic. I have some experience with a business that operates in California and it is a VERY expensive jurisdiction to operate that is extremely friendly to labour unions, is unfriendly to business and has relatively high taxes compared to other states. And yet Tesla chose to locate there.

In fact you could do a Search/Replace of Canada with California and your statements would still ring true.

Yes it is a bit simplistic, but it's also true. As always, there are many factors to the problem.

But
Our business was founded in the late 70's, and our main customers were Original Equipment Manufacturers and industrials. We changed our business model in the late 90's as we saw that our industrial base was beginning to shift to a commercial and information based economy (in southern Ontario). The last 15 years has seen most of the small and medium manufacturers disappear to China, Mexico and the Southern USA - to the point where "a low dollar" doesn't matter as much to manufacturing exporters - as there are so few left. Yes we have automotive manufacturers and big Canadian suppliers (Magna, Linamar) as well as a few large OEM to build their machinery (Valiant Machine, Prodomax, ATS)....but that is it. The thousands of small tool builders, machine assemblers etc have left the country, gone broke, or shuttered their Ontario facilities. Most of them for the reasons stated above in my comment. They are not coming back.

I sit on the Board of the Electrofederation of Canada. One of our most interesting committees is a "Canadian manufacturers' group". They constantly talk of the increasing problems with staying in Canada....and yes most of their comments are reflected in mine. @Phillip L is also correct; Hydro costs are killing them.
Examples: Bill Hammond CEO of Hammond Power Solutions, Guelph Ontario has gone on record several times on his reasons to move manufacturing from Guelph to Mexico as those above. (Note that he still has factories in Guelph, Walkerton, and Granby QC)
Shelley Bacon CEO of Northern Cables, Brockville Ontario has stated in a number of public meetings: The Ontario government's unwillingness to keep hydro rates to "reasonable rates" is the biggest reason for him not to expand in Brockville, He also states that Government red tape and difficulty in doing business is a show stopper as well. Northern Cables will probably locate a factory in the Southern USA.

Yes California has high labour costs, and is more union friendly than some States (not as friendly as Canada). They did locate where they knew their biggest market would be, and more importantly, where the intellectual ability is located.
 

Doug_G

Lead Moderator
Global Moderator
Apr 2, 2010
17,884
3,394
Ottawa, Canada
We acquired the assets of a small California company a couple of years ago, and integrated their business into our Ontario-based company. I gotta say, from what I saw of how things were running down there prior to our acquisition, I'm really glad we're in Ontario! All kinds of regulations, much higher business taxes (for small businesses more than double), health care costs, zero government support, you name it. The only reason anyone sane would locate there is for the network effects of being near other high-tech businesses and universities (availability of suppliers, employees, etc.). Other than that it's a terrible business environment.

Not saying Ontario is well-run or anything, but in comparison...
 

sitter_k

Active Member
Jun 23, 2014
1,032
551
Toronto (GTA)
While that is true over the last five years or so, I don't know that it is true in the last year as the rate went from $0.384 to $0.294 from 2015-6 and my understanding is that panel (and other hardware) costs went up due to the fall in the Canadian dollar.
And because Chinese panels were essentially banned by charging a 200% tariff on them, which somehow increased the cost (profit) to NA suppliers.
 

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