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The recent U.S. election has brought to a head discussions on revisiting NAFTA. The APMA has been active in publicly advocating for the importance of the trade agreement (prior to the election and ongoing), emphasizing the interdependency of the North American automotive supply chains in anticipation of any potential trade agreement discussions.
APMA members should be aware that we are on the forefront of all issues relating to trade and matters that may impact the Canadian automotive supply chain. While you may hear varying reports in the media concerning NAFTA and other trade agreements, APMA wishes to advise its members that we are actively working on your behalf and that your voice is being heard.
Below is a round-up of important NAFTA article summaries over the last few months, emphasizing the need for free trade-partners in an increasingly global industry. Please click on “READ MORE HERE” or “WATCH HERE” to access articles and videos in full.
March 23, 2017
READ MORE HERE
TORONTO — Ontario Premier Kathleen Wynne met with Canadian automotive executives and labour leaders in Toronto on Friday to strategize about how best to approach a potential renegotiation of the North American Free Trade Agreement.
The group, which also included Minister of Economic Development and Growth Brad Duguid, discussed the importance of emphasizing the interconnectedness of the North American automotive industry. The approach has emerged as a key tactic in countering trade pressures from the United States government.
While the possibility that the United States may attempt to negotiate separate trade deals with Canada and Mexico has been raised, Volpe said that Canadian stakeholders see the tripartite arrangement of NAFTA as being an important one for the industry at large.
“I think everybody is committed to trilateralism unless the Earth moves, and then we’ll deal with it differently if the need arises,” he said. “But we’re all looking at this as all three countries help to manufacture cost-competitive vehicles in competition with the other major regions in the world. Ideally, we maintain that balance.”
March 21, 2017
Canada’s auto parts suppliers want U.S. lawmakers to realize how integrated the North American automotive industry is, so it’s currently taking stock of all Canadian companies that have operations in the United States.
The Automotive Parts Manufacturers Association is conducting a survey it calls Measure of Canadian Companies Having a U.S. Manufacturing Footprint.” Its goal is to determine how many facilities Canadian companies operate in the United States, the number of Americans they employ, and in which U.S. electoral districts those plants are located.
“Not only will your submission assist our efforts, but it will also assist your company as we take the aggregate State statistical information to Washington and remind individual congressional representatives that while companies in their jurisdictions may be Canadian owned, the jobs created are American (voters),” the APMA says on its note to members.
The information will help ensure that healthy trade relations between Canada and the United States stay strong.
“As a country, we’re a pretty big international investor,” APMA President Flavio Volpe said. “Canadian parts suppliers are one of the biggest employers, employing Americans and Mexicans. It’s important for us — ‘us’ being the industry at large and the provincial and federal governments, who advocate on our behalf — to understand what Canadian investment across NAFTA looks like.”
As appeared on BNN, February 27, 2017
Automotive Parts Manufacturers’ Association (APMA) hosted a roundtable discussion with Prime Minister Justin Trudeau on Monday. APMA president Flavio Volpe is impressed with Trudeau’s approach to the auto industry, and how much Foreign Affairs Minister Chrystia Freeland brings to the sector.
CP24 Coverage, February 27, 2017
February 28, 2017
Prime Minister Justin Trudeau met with representatives from automotive parts manufacturers on Monday afternoon in Toronto for a roundtable discussion on their industry.
The meeting, held at the Automotive Parts Manufacturers’ Association head office in Toronto, included representatives from companies such as Magna International, Martinrea International, ABC Group and The Woodbridge Group.
Part of the discussions were over President Donald Trump’s campaign pledges to tear up or renegotiate the North American Free Trade Agreement. However, representatives at the meeting say their concerns are lessening.
“I think that the Prime Minister and the President [Trump] had a good first date,” said Flavio Volpe, president of the Automotive Parts Manufacturers’ Association. “We’re not really worried.”
February 27, 2017
A meeting Feb. 27 between Prime Minister Justin Trudeau and key players in the auto supply industry suggested possible federal-industry collaboration in efforts to shield Canada’s auto industry from disruptions threatened in the United States.
The roundtable discussion with high-ranking officials from the auto parts sector included Automotive Parts Manufacturers Association (APMA) President Flavio Volpe, Martinrea International Executive Chair Rob Wildeboer, Magna International CEO Don Walker and others. Trudeau brought with him Chrystia Freeland, Canada’s point person on NAFTA.
“It was a good listening session from both sides,” Volpe told Automotive News Canada immediately after the one-hour meeting. “The prime minister has a very good understanding of the dynamics that affect the industry, from trade to the consumer to currency.”
Published Monday, Feb. 27, 2017 5:47PM EST; Last updated Monday, Feb. 27, 2017 5:47PM EST
READ MORE HERE (SUBSCRIBERS ONLY)
GREG KEENAN – AUTO INDUSTRY REPORTER
TORONTO — The Globe and Mail
The federal government is doing the right things so far as it gears up for negotiations with the United States and Mexico on a new North American free-trade agreement, senior executives of Canada’s automotive-parts makers say.
The government – and major players in the industry – are in the midst of gathering facts about the impact a new NAFTA deal, border taxes or tariffs on vehicles would have on the auto sector and that should continue, executives said after a roundtable discussion in Toronto on Monday with Prime Minister Justin Trudeau and Foreign Affairs Minister Chrystia Freeland.
Discussions on the auto industry will be a critical part of any NAFTA renegotiation – in part because three-way free trade in vehicles and parts underpins the entire industry in North America. Vehicles are assembled in each of the countries and shipped duty-free across borders while U.S., Canadian and Mexican components that go into those vehicles also enter each of the countries without tariff.
The sector also appears to be at the top of U.S. President Donald Trump’s hit list after his tweets earlier this year, and during the election campaign last year, that castigated various auto makers for building assembly plants in Mexico and then planning to ship the vehicles into the U.S. market.
But the relationship between Mr. Trudeau and Mr. Trump seems to have started well with “a good first date,” earlier this month when they met in Washington, said Flavio Volpe, president of the Automotive Parts Manufacturers’ Association of Canada (APMA), who played host to the meeting.
The federal government has moved early to make sure Canada’s views are known and “I think the language you hear out of Washington about Canada reflects the fruits of that,” Mr. Volpe said.
Mr. Trudeau told the industry leaders in a brief comment before the one-hour, closed-door meeting began that, because NAFTA matters to the auto industry, it matters to all Canadians.
“The high level of integration between our economies, particularly in the auto sector, needs to be continued and protected and recognized as a tremendous driver of jobs and opportunity on both sides of the border,” he said. He refused to answer questions from the media.
Don Walker, chief executive officer of Magna International Inc., said NAFTA as a region needs to remain competitive when compared with Europe and Asia.
“If you look at NAFTA, Europe and China and the rest of Asia, we shouldn’t be doing anything to damage the competitiveness of NAFTA,” Mr. Walker said.
Both Magna and Martinrea have made significant investments in Mexico – and the United States – reflecting how the industry has grown since NAFTA took effect.
Global auto makers have invested billions of dollars in assembly plants in Mexico in recent years. Mexico’s vehicle production has doubled to about four million units a year since 1994 and is projected to top five million by 2020.
With a possible renegotiation of the North American Free Trade Agreement looming, Prime Minister Justin Trudeau sat down to reassure representatives from the auto industry on Monday.
Trudeau and foreign affairs minister Chrystia Freeland visited the Automotive Parts Manufacturers Association’s Toronto office for a closed-door meeting with business leaders. Earlier this month, the Prime Minister met with U.S. President Donald Trump, who has promised to renegotiate NAFTA on terms more favourable to the U.S.
APMA president Flavio Volpe said he was feeling optimistic following Trudeau’s trip to the White House. During the visit, Trump acknowledged he was more concerned about trade with Mexico than with Canada and called it a “wonderful meeting” on Twitter.
“The more we hear from the president’s nominees, the less anxious anybody is,” Volpe said. “They understand the dynamic and I think they understand Canada is a full partner. We’re not really worried.”
Feb 14, 2017
The sigh from the C-Suite was one of relief as Canadian business leaders took comfort Monday in the positive tone on trade struck by Prime Minister Justin Trudeau and President Donald Trump.
From the forestry industry to the automotive sector to the oilpatch, Corporate Canada kept a close eye on the first one-on-one meeting between the two leaders, parsing every word they uttered for clues on the future of trade between the two countries.
Trump, who won the U.S. election campaigning on a promise to renegotiate the North American Free Trade Agreement, beamed about America’s “very outstanding trade relationship with Canada.”
The president of the Automotive Parts Manufacturers’ Association, which represents companies that are acutely integrated across North America, said Trump’s comments were a welcome affirmation of what he’s been quietly hearing from U.S. officials over the last couple of months.
“We were pleasantly surprised that the president would have used as many superlatives when discussing his view on Canada as a trading partner,” Flavio Volpe said.
Volpe said that going forward, he’ll be emphasizing how much America — and American consumers — have benefited from one of the most integrated industries in the world.
“We’re happy to share any and all data and give them a sense of how American interests have been well-served in all three countries.”
FEBRUARY 13, 2017
WASHINGTON — Despite sharp differences on immigration, refugees, trade and climate change, President Trump and Prime Minister Justin Trudeau of Canada struck a cordial tone on Monday in their first meeting, alternating between attempting to bridge those gaps and steering clear of them ….
Flavio Volpe, the president of the Auto Parts Manufacturers’ Association, a trade group, said that it was important for his members to hear Mr. Trump’s message that he is not planning to dramatically remake the United States’ trade relationship to Canada ….
Thu., Feb. 9, 2017
Prime Minister Justin Trudeau heads to the White House Monday for his first face-to-face meeting with U.S. President Donald Trump, a high-stakes session that will set the tone for relations between the two nations for years to come.
Personal relationships between leaders matter, says David Wilkins, former U.S. ambassador to Canada.
The upcoming meeting is “immensely important” for the two leaders “to meet and develop a good working relationship,” said Wilkins, past envoy for Republican president George W. Bush in Ottawa. “I think the key is to find middle ground, and there’s plenty of middle ground to find.”…..
Flavio Volpe, head of the Automotive Parts Manufacturers’ Association, one of many stakeholders the Trudeau government has consulted, said in an interview, “You can’t make a car, you can’t do a final assembly in any of the three countries without sourcing parts from the other two.”
“Part of the discussion is to make sure everyone understands that in our business there are no borders. And the American interest exists in all three countries, as well as the Mexican and Canadian interest.”
“You will harm American interests if you thicken the border between Michigan and Ontario”
January 11, 2017
READ MORE HERE (Begins after shaded transcript)
JD: It’s becoming kind of a familiar pattern: Donald Trump tweets, and the stock market reacts. Today, the President-elect’s call for General Motors to bring Mexican jobs over to the U.S. wobbled the automaker’s share price. In a tweet he threatened the company with a quote, “big border tax for any cars that are made in Mexico and shipped to U.S.” Ford, meanwhile, has dropped its plan for a plant in Mexico. And, of course, Mr. Trump has pledged to renegotiate the North American Free Trade Agreement (NAFTA). In an effort to prevent American jobs from leaving the country and all of this has Canadian auto manufacturers worried. Flavio Volpe is the president of the Canadian Automotive Parts Manufacturers’ Association. We reached him in Toronto.
HM: Mr. Volpe, what are your thoughts today about Donald Trump’s tweets and the reaction we’re seeing from the auto industry?
FLAVIO VOLPE: It’s tactics, certainly the President-elect has made clear what he expects from American automotive manufacturers. And it’s just a tactic that we’re not used to seeing.
Read the full transcript here (Begins after shaded transcript)
January 20, 2017: BNN speaks with Flavio Volpe, president at Automotive Parts Manufacturers’ Association.
Canada need not worry as long as American interest is addressed.
Volpe says the Trump administration understands the importance of the U.S.-Canada trade relationship and that the latest protectionist rhetoric targeting the auto sector is simply Trump trying to ensure American interests are met.
November 24, 2016: BNN speaks with Flavio Volpe, president at Automotive Parts Manufacturers’ Association.
As Canadian businesses brace for the policies that U.S. President-elect Donald Trump brings in on NAFTA and climate change, BNN speaks with APMA President, Flavio Volpe about how this will affect investment in Canada.
November 17, 2016
READ MORE HERE
But Canada’s auto sector, which is heavily integrated with both the U.S. and Mexican industries, said only a trilateral deal would work for Canadian automakers and parts suppliers.
“It (the North American auto industry) really only works if there are no borders,” said Flavio Volpe, president of the Automotive Parts Manufacturers’ Association, which represents Canadian independent parts makers.
“A revision of NAFTA for the auto sector – there’s likely zero support for it.”
November 16, 2016
READ MORE HERE (Subscribers only)
“There isn’t a binary decision that he can make that can solve that problem [of lost jobs],” said Flavio Volpe, president of Canada’s Automotive Parts Manufacturers’ Association.
Many of North America’s biggest manufacturers have supply chains stretching across all three countries, with products crossing borders multiple times before they are ready for sale. Changes to the NAFTA that complicate that flow could cost jobs in the U.S., as well as in Canada and Mexico, said Mr. Volpe.
“You’re going to hurt American interests, at some point, with any move you make. And those auto workers that voted for him, maybe, they work for those companies,” he said. …
The Canadian and U.S. auto industries are “almost completely aligned” on the NAFTA and free trade, said Mr. Volpe. That’s unsurprising, given that the same large automakers operate in both countries.
Mr. Volpe and the companies he represents will be delivering their message to existing allies in Congress, and relying on Canada’s embassy in Washington for introductions to new Representatives and Senators, said Mr. Volpe.
November 9, 2016
READ MORE HERE or HERE
Flavio Volpe, president of the Automotive Parts Manufacturers’ Association, said suppliers and tool makers with assets in the U.S. and/or Mexico have spent the last few months trying to determine the impact of a Trump presidency.
“It’s too early to express practical concerns, but we will have to be vigilant in telling the auto industry integration story in Washington,” said Volpe. “The challenge for Ontario and Canada’s auto industry is to make sure the new administration understands that any protectionist measures against imports equally affect the profitability of American companies. We’re so integrated, you can’t supply operations on either side of the border efficiently if that border gets thicker.”
Flavio Volpe, President of the Automotive Parts Manufacturers’ Association, is also concerned about NAFTA being repealed, and what that would mean for a business that routinely ships parts across the border.”You can’t make a car in Michigan without parts from Ontario and you can’t make a car in Ontario without parts from Michigan, everyone knows that,” Volpe said.
For now, his organization will keep an eye on Trump. If the president-elect does move to repeal NAFTA, Volpe said his group will work with governments on both sides of the border to make sure Ontario’s industry isn’t damaged.
Flavio Volpe, head of the Canadian Automotive Parts Manufacturers’ Association, told Automotive News Canada the elimination of NAFTA, or at least a revised version of the deal, could be good for Ontario. However, the province would need help from Rust Belt states like Michigan, Ohio, Indiana and Pennsylvania, all of which voted for Trump.
“If the Great Lakes states and the Midwest States can explain to Washington that Ontario is essentially a part of that region, then it’s good for Ontario,” Volpe said. “But it will come down to state-to-state, province-to-state co-support and the articulation of how integrated we are.”
For example, 30 per cent of the parts used at the more than 10 auto assembly plants in Michigan come from Ontario, Volpe estimates.
As the vote grew closer, the auto industry started planning, APMA President Flavio Volpe said.
“People were starting to model what it would look like if a Trump victory meant a new look at NAFTA,” Volpe told Automotive News Canada, Nov. 9. “I think everyone was prudently saying, ‘If he wins, what does it mean for us?’
“I heard that in Washington, D.C. when we went there [in September] and we met with Congressional leaders and manufacturing leaders. I heard that in Detroit.
“And I certainly heard it up and down Highway 401 on this side of the border.”
That could bode well for Ontario if its partnerships with states like Michigan remain strong, Volpe said.
An estimated 30 per cent of the parts used in Michigan assembly plants alone are Canadian made, Volpe previously told Automotive News Canada.
“You can’t take for granted who may or may not advise the president,” Volpe said, “but certainly Michigan’s Congress representatives and Senate representatives will be able to very quickly state how important it is that the border stays fluid and those [Canadian] relationships don’t get disrupted.
“If we’re successful in doing that, I think Ontario and Canada is in a relatively better position than any number of Mexican states.”
Volpe said “a deep dive and debate on what NAFTA 2.0 looks like” is likely now that Trump won the presidency.
“I imagine there will be some compromises before they crystallize their position on NAFTA,” he said. “If the Republican Congress thinks pulling out of NAFTA is a bad thing, and assuming that’s where he wants to go, they have the ability within their jurisdiction, to put a fence around him.”
September 18, 2016
Flavio Volpe, president of the Automotive Parts Manufacturers’ Association of Canada, says the auto parts business operates on slim margins: “A 35 percent tariff would be a reckless instrument that would put an immediate chill on anybody’s investment in any of the three countries.”
Industry officials such as Volpe credit NAFTA with allowing North America to be competitive in an increasingly global industry. “The rise of Mexico as a free trading zone in my opinion is one of the catalysts that allow automakers to profitably go to a global product platform,” Volpe says.
Volpe, of the Automotive Parts Manufacturers’ Association of Canada, says Canada and other countries look to the U.S. to set an example. Recklessness on the part of the U.S. would encourage other countries to disregard world trade rules, he says. “Some of the rest of the world does cheat on those obligations,” Volpe says. “But the solution isn’t for the global trading leader to drop its standards in response.
“It’s a tough spot to be in. But you’re there for a reason. It’s like Superman getting into a bar fight. Why?”
August 8, 2016
Automotive-related companies, including in Windsor, have adjusted to NAFTA and created “the world’s most integrated supply chain,” said Flavio Volpe, president of the Automotive Parts Manufacturers’ Association. Severing those links, he said, would be “problematic” and could harm the very manufacturing businesses Trump promises his plan would help.
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