Ford is right: Ontario has the right stuff to lead on electric vehicles

Can Ontario become a one-stop shop in electric vehicle manufacture unlike any other market in all of North America?

Premier Doug Ford thinks so. And in the abstract, he makes a good case.

In the specific, there are major hurdles to be overcome.

Consider, first, the long-troubled Ring of Fire, the much touted and frequently stymied reserve of mineral riches in the James Bay Lowlands. The Ford government’s economic outlook of a week ago promised that the Ring of Fire, with its reserves of nickel, cobalt, manganese and more, will play a key role in the future of clean manufacturing in Ontario.

Makes sense. Such elements are essential in the lithium-ion batteries that power electric vehicles. And certainly northern Ontario has a world-class reputation when it comes to mineral extraction.

The province does not, however, have a world-class reputation for meaningful consultation with First Nations, which the government insists it is now addressing, in part through collaborative discussions with Nishnawbe Aski Nation, which represents 49 First Nations communities.

Nor has it delivered on long-standing promises for infrastructure investment, promises made by successive governments that have stated their faith in the future economic prosperity of the far north. Ford is calling for the federal government to step up.

Nor has the private sector yet followed through on ambitious development plans. The exit of Cliffs Natural Resources, which sold its prime Ring of Fire assets to Noront Resources, which itself is now on the verge of a takeover scheduled for later this month, is a case in point. That drama has been playing out for more than a decade.

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True, times have changed. The early mining players could not have envisioned a day when Elon Musk would be complaining about securing nickel supply for all those battery-powered Teslas.

And the federal government’s climate-aware stance favours Ford’s pledge to nurture multi-generational economic prosperity through the auto industry’s swing to EVs. The Liberals’ target: all new cars and light-duty trucks sold in Canada will be zero emission vehicles, including hybrids, by 2035.

As the premier himself said on Wednesday, the day will come when car buyers will face a choice: you’re either going to buy an electric vehicle, or you’re going to buy an electric vehicle.

Thousands of jobs will be created in manufacturing batteries, the premier says. And thousands of jobs will be secured in the manufacture of the vehicles. His prediction: Ontario will become the No. 1 end-to-end manufacturer of battery-operated cars in North America.

There was no mention of U.S. President Joe Biden’s Build Back Better refundable tax credit, which guarantees as much as $12,500 (U.S.) to EV purchasers, including $4,500 if the auto is made in the United States in a unionized shop and a further $500 if the battery is American made. The Build Back Better bill is scheduled to go to a vote next week.

Biden’s Buy America stance is a problem. International Trade Minister Mary Ng has acknowledged the obvious: such a program will severely disrupt plans for EV production in Canada specifically, while broadly undermining the U.S.-Mexico-Canada integration of the auto sector.

Meanwhile, some U.S. states are legislating their own incentives to woo industry. Illinois lawmakers recently passed the Reimagining Electric Vehicles in Illinois Act, aimed at incentivizing Stellantis, the massive automaker that includes the Fiat, Chrysler and Peugeot brands, to name a few, to keep production in the state.

The bottom line: after three decades of tottering progress, automakers are going full throttle on electric. Premier Ford is right in saying Ontario has the right stuff to become a pre-eminent player. But he has miles to go to prove the province is truly, well, on fire with the idea.