Today's discussion:

Both Trump and Biden loom large over Trudeau and Ford’s big EV bet

Political developments in the U.S. over the past few years have substantially increased the risk of any investment that relies on unrestricted access to the U.S. market. Both Trump and Biden have signalled their support for "America First" industrial policies that would pose significant challenges to Canada's subsidized EV sector.

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B Kirschenman

All this is assuming EVs are the future for Canada. BMW has already halted EV production and is focusing on hydrogen. If only governments would quit picking winners (and losers).

1st May 2024 at 9:13 am
Don Morris

Agreed,but can you name a government “winner”? Try as I might,I can’t think of one.

1st May 2024 at 11:46 am

The TMX pipe

1st May 2024 at 2:35 pm

At $34B (and counting) that’s some win, Lauraine.

Money that we didn’t have to put in had the Trudeau Government simply gotten out of the way and allowed a private sector company to build it with their own cash.

1st May 2024 at 3:17 pm
Gordon Divitt

This from BMW’s very recent press release

The Munich plant is an excellent example of our ability to adapt. We are investing € 650 million here and will produce exclusively all-electric vehicles in our parent plant from the end of 2027,” says Milan Nedeljković, Member of the Board of Management of BMW AG, Production. “Last year alone, six all-electric models went into production. At the same time, we also set a production record, proving that we are simultaneously able to both deliver and shape the future in our production network.”

1st May 2024 at 5:38 pm
B Kirschenman

Interesting! We were at BMW plant in Munich 3 weeks ago and were told the opposite. Hmmm.

2nd May 2024 at 1:19 am

Trudeau’s EV plans have never made sense. His mandates for Canada and general expectations for the EV industry were made without due consideration for the known resource, infrastructure and cost constraints. If Trump get in, he will roll over Trudeau and his left of Center agenda.

1st May 2024 at 9:09 am

Trump did not roll over us, last time and he wont now.

1st May 2024 at 2:27 pm
Paul Attics

Obviously investing taxpayer money into EV manufacturing “makes sense” to lots of those in and out of government. There is certainly lots of risk in the investment. There is certainly lots of room for debate about whether or not this is an effective use of limited taxpayer resources.

If the assertion that it “never made sense” is so simple and obvious, can you break it down with any specificity beyond ‘due consideration for the known constraints’ that generally apply to any big public project?

1st May 2024 at 9:52 am

1) Richer people ( lets say Canadians ) who have the extra cash – disposable monies will buy a new toy – in this case EV’s. ( Since they still have there 6 seater gas guzzling SUV’s ) Most of us “Lower people” can’t buy toys. Mine is an older 2006 motorcycle.

2) EV sales have dropped and slowed down as all the people who could buy toys have already bought using the tax payers ( us ) subsidies, to reduce the cash they need to buy their toy ( why the Govt subsidies people with extra cash that would of bought anyways I do not understand. )

3) The Govt should not be in the “stock market” betting on winners and losers, especially with my tax dollars. SO none of the “peoples monies” should be used to these companies holding the govt hostage for a plant that may or may not make monies.

3) Canada is such a small market, ( in other worlds a tiny insignificant dispersed population, dead broke – in debt ) compared to the USA. If we give 1 billion to companies, the USA can give 100 billion and not blink an eye.

4) I’ll survive, retiring from my same self employed job for over 40 years. My 4 kids ( 32 – 40 ) are getting by but not ahead, all rent. ( They will be paying Canadas debt and taxes, not me. ). My grandchildren, they are totally screwed unless their parents can vote – and slowly fix the current governments over the next 20 years.

5) What’s this have to do with EV’s, not all that much, but if we are subsiding EVs now, what the next / new flavor of the month and govt bet of the year when this may or not fail in 5 years.

6) Too late for the “Baby boomers” to do much, But at least for the few, the Kids – Grandkids will get enough inheritance to help them get by in this screwed up future the govt is placing us in.

1st May 2024 at 11:01 am
Greg Jackson

Governments, both provincial and federal, will continue to pick favorites and play “chicken” with taxpayers’ money, as long as they are not held to account for their irresponsible actions. Although this is not the forum to discuss the “green-ness” of electric vehicles, which is highly debatable, ultimately in a capitalist system the market will determine winners and losers.
Given the inherent problems with grid capacity and cold climate in Canada, it would seem to be a risky bet, barring unfettered access to the US market, which looks to be more and more unlikely. For the domestic market in Canada, hydrogen as a fuel source makes far more sense when considering the vast expanse of the country and the limited range, especially in cold temperatures, of EV’s.
So, does the investment in Honda and others to produce batteries and EV’s, look good? Time will tell, but you can be sure that neither Trudeau nor Ford will be around to be held accountable, if things go pear-shaped.

1st May 2024 at 9:52 am
Michael B

Last I checked “green” hydrogen was retailing at $13 /KG in B.C. and $16 /KG in California. This after generous subsides in both jurisdictions. From what I understand a KG of hydrogen has the gross energy equivalent a 3 liters of diesel.

1st May 2024 at 10:44 am
Greg Jackson

When we put as much cash and effort into hydrogen production as we have into battery technology, the price will surely come down. Also for all you green types out there, note that there is no damage to the environment from hydrogen production on the scale seen from lithium and cobalt production. Hydrogen production by water electrolysis can also be separated from the grid, as opposed to millions of charging stations. Just sayin”…

1st May 2024 at 3:31 pm

Hondas decision to spend their billions is not based on fresh air or political bents. It was a huge business

1st May 2024 at 2:29 pm
Don Parker

I think it is a huge mistake investing this kind of money in one resource. A plant in Windsor, a plant in Elgin County, a plant in Alliston and now another one. Government spending our tax dollars on these plants when the electric vehicle craze is being examined and not practical for your average person. Again wasting our tax dollars and bringing all these harmful chemical waste to one of Canada’s riches farm lands. I think the one in Windsor is enough of a waste.

1st May 2024 at 10:55 am

How do the naysayers think auto manufacturing in canada ever happened, certainly not without subsidies, as the oil industry did and does.

1st May 2024 at 2:31 pm
Kim Morton

While some Canadians work themselves into a tizzy over Trump becoming Prez, even though we have no say in the matter, the rest of us worry about what protectionist Democrats will do to our exports. Just look at the dramatic increase on softwood lumber the Biden administration imposed on Canada to see who is the bigger nightmare.

1st May 2024 at 9:51 am
Ian Gray

I agree, and with a couple of others above. Dislike of Trump, a very large stump if you will, has blinded far too many from the ability to see the forest and manage the future to our benefit.

1st May 2024 at 12:49 pm
Paul Attics

The heavy investment in EV sector has significant risks to expected ROI, mostly related to US-Canada relations it seems versus the viability and trends of the technology itself. The most significant risk is a Trump administration.

The risks that will loom large if somehow enough American voters decide that Trump should be President Elect in November will be many, and many overshadowing the possible negative impact to Canada’s future EV sector. Despite his shocking popularity, Trump is singularly and demonstrably unqualified for the office of President in an already shaky democracy.

Regardless of the positives about Trump, his actions and stated intentions are indefensible if one’s principles include a support of democracy, strength of institutions, the simple rule of law, and common decency to fellow human beings.

1st May 2024 at 8:00 am

The question of Donald Trump’s fitness for the office of President will be answered later this fall by Americans – not us. The answer, therefore, is not to continue engaging in some pointless exercise of debasing the man but, rather, to prepare for the possibility of his return to the Whitehouse and what that may mean for our economy. Continue to hope for the best, if you will, but the time to prepare for the worst is now.

So then, what about the pesky issue of supply management that Laurentian capitalists always find themselves with their backs up against a wall, a policy they stubbornly cling to whenever they engage in negotiations with potential trading partners abroad or are called to renegotiate existing agreements?

Maintaining the status quo, where a select few (producers) must benefit and prevail at the expense of pretty much everyone else (consumers), may play well for them on the domestic political scene. When up against hardball negotiators – like the former and possibly soon-to-be reelected President – who play the game with taller stacks of chips in front of them, that dog don’t hunt.

1st May 2024 at 8:58 am
Dave Collins

Your point is well taken. It is up to Americans to determine their next POTUS, and there is a fair chance, especially considering Biden’s poor performance, that Trump may well be elected.
I would add that Trump is a hard nosed businessman, and yes, a narcissist. That being said, it is in our interest to demonstrate to him that it is in America’s best interest to work together with Canada, and share, and take advantage of each country’s strengths, and demonstrate where we can add value, as opposed to doing what Trudeau, Freeland, and company did the last time, and insult, belittle, try to show their superiority, and yes, poke the bear for the sake of their own egos, and as a result, turn him against us. As you said, that dog don’t hunt.

1st May 2024 at 10:02 am
Paul Attics

“The answer, therefore, is not to continue engaging in some pointless exercise of debasing the man..”
Despite the criticism of Trump as a human being, my comment is primarily based on risk. Much of that risk is based on the self-interested actions of our economic giant neighbor. Much of those actions depend on who is in the White House. If Trump is the occupant of the White House, the negative risk of arbitrary disruption of our EV investment is arguably much greater than Biden.

1st May 2024 at 1:24 pm

Paul, I’ve never bought into the media line that everything President Trump does is arbitrary. He may come across that way, but he knows exactly what he’s doing. He isn’t at all adverse to ruffling a few feathers if that’s what it takes to move things in the direction he wants to take them. That’s his style.

That his focus is on his country’s national interests is commendable. The same can be said about other world leaders and the approaches they take – the exception being our own post-national Prime Minister, who apparently is all-in with handing out massive subsidies to companies without considering the risks of throwing all our eggs into that one EV basket.

If President Biden loses this fall, then we may well have to live with the consequences of Prime Minister Trudeau’s narrow focus (if one believes that he seriously believes EV technology is the only solution and the commitments he’s made on our behalf are not some crass attempt to shore up his sagging political fortunes in Ontario, where most of those billions have been sunk).

The risks to our economy are great. Better to adopt a pragmatic approach in knowing who we’re potentially up against next January, then playing for a win that benefits both countries.

1st May 2024 at 2:44 pm
Ray Howarth

Don’t bet on that.

1st May 2024 at 2:01 pm
Alan Murdock

Perhaps we should have focused more on hydrogen energy development.

OOPs – that’s Alberta again?

1st May 2024 at 6:34 pm

Canada is being taken on a Green Fantasy ride subsidizing these Battery plants and EVs. They can’t be run on our present or any practical future electric GRID. Lithium etc battery metal mining is an environmental disaster for worse than gasoline and CO2. The taxpayer is being hosed.

1st May 2024 at 8:34 pm

Something often overlooked is that not only are taxpayers on the hook for the tens of billions being handed out but also for the interest since it is all borrowed money. Over the years many billions will be added to the bill.

If the government truely beleived that EVs are essential for saving the planet, then it should remove the tarriffs and other hinderances to importing Chinese EVs. An entry level Chinese EV starts at about $20,000. But they are all talk and vote buying.

1st May 2024 at 2:46 pm