Trudeau’s gambit could cost thousands of jobs in Brampton, an area full of Liberal MPs.
The Stellantis deal in Windsor is up in the air again and that could mean trouble for thousands of auto jobs in Brampton.
No one is speaking on the record but there’s plenty of background chatter about who is to blame and, once again, most are pointing to Ottawa.
Last weekend, it looked like a deal had been struck that saw the Ford government at Queen’s Park join the Trudeau government in Ottawa to sweeten the pot to secure the Stellantis deal.
Stellantis had stopped work on their electric vehicle battery plant earlier in the week, the reason given, the Trudeau government hadn’t lived up to promises made to the company. Instead of proceeding with work on the plant, the company said they were examining “contingencies,” which is another way of saying they were looking at moving production to the United States.
The Biden administration in Washington has been offering lucrative incentives in the form of the Advanced Manufacturing Production Credit, a tax break for companies building things like electric vehicle batteries.
The Trudeau government promised to match those incentives but didn’t when it came to Stellantis.
That’s what led to the decision by Stellantis to stop construction. Why build here when the Americans will offer more, and why build here when the government promises one thing and then reneges on it?
Shortly after Stellantis stopped construction, the Trudeau government said the real problem was that Ontario wasn’t paying its fair share for the deal. That started a public relations war between Ottawa and Queen’s Park to get the Ford government to sweeten what they were offering to Stellantis.
The Ford government had offered Stellantis $500 million to secure the facilities, including money to upgrade infrastructure such as roads and ensuring adequate electrical supply. What they hadn’t done, and didn’t normally do, was match an American federal incentive, that’s normally what the Canadian government does.
Determined to get a deal, Ford agreed to Trudeau’s terms in exchange for other concessions such as the feds easing up on opposition to Ontario building Hwy. 413 and being supportive of the Ring of Fire plans to mine critical minerals in Northern Ontario.
According to sources close to Stellantis, the deal the federal government presented to the company was effectively the same deal as the previous one but now with Ontario bearing some of the federal burden.
The Biden administration is offering companies a production credit of $35 per kilowatt hour for battery cells and an additional $10 per kilowatt hour for battery modules. The Trudeau government is just offering the $35 for cells and not matching the additional $10 for modules, making the U.S. a more lucrative place to make the modules.
For Stellantis, that could be as simple as moving module production across the river to Detroit or perhaps going somewhere deeper inside the U.S. That would mean the loss of about 300 jobs at the Windsor plant once construction is complete, but the impact wouldn’t be limited to Southwestern Ontario.
There are worries by some in the auto sector that if Stellantis pulls the module plant they will also pull production from their auto assembly plant in Brampton, which employs just shy of 3,000 workers. That’s not a view shared by all the players involved but it is a concern.
Prior to the Stellantis announcement that they would expand in Windsor, there was widespread concern the Brampton plant would close for good. The plant has been producing the Chrysler 300, Dodge Charger and Dodge Challenger but was expected to switch over to an EV SUV of some sort in 2025 after undergoing a retooling in 2024.
Some auto industry types now believe that is up in the air as Stellantis looks at all contingencies.
Stellantis and Unifor, the union representing workers at all the plants involved, declined to comment when contacted Friday. Requests for comment by various representatives from the Ford and Trudeau government were ignored.
Meanwhile, workers in Windsor and Brampton worry about their future.
Political games are being played and, once again, it’s the people working the line who may pay the price.
Source: Toronto Sun
