Auto workers face uncertainty amid Canada’s EV transition

Hopes that electric vehicles will revitalize the auto industry in Canada have yet to materialize, leaving some more concerned about the sector’s future, according to a report by Financial Post.

The report focuses on how Canadian auto parts workers are being affected by efforts to strengthen the country’s EV sector, efforts that are facing headwinds as the transition to electric vehicles progresses more slowly than anticipated.

First things first: A key part of Canada’s EV strategy has been to incentivize automakers and suppliers to invest in the domestic EV industry—following the U.S.’s playbook. So far, automakers and battery companies have committed $46.1 billion to Canada’s EV supply chain.

• In return, those companies are receiving $52.5 billion in financial support from the Canadian government.

Pros and cons: Retooling auto parts plants—responsible for more than half of all automotive jobs in the country—is a critical part of this transition. However, the process has disrupted operations.

One example is the Brampton, Ontario, plant, which produces front and rear suspensions for Dodge's Charger and Challenger models. Stellantis closed the facility at the end of 2023 for an 18-month retooling project to adapt production for battery-electric, plug-in hybrid, and internal combustion vehicles.

• Job losses: The closure resulted in the loss of 150 jobs at the Brampton plant.

• What’s next: The plant is scheduled to reopen in late 2025, with plans to return to three shifts as part of Stellantis’s $3.6 billion investment, supported by $1 billion from the Canadian government​.

Unifor, the primary union representing auto workers has raised concerns about job security during the transition. The union is actively negotiating for better income security to protect workers during plant shutdowns and retooling phases.

Why it matters: Canada’s push to grow its EV sector will likely intensify in the coming years as the country aims to meet its net-zero emissions target by 2050. But economists warn that these investments may take time to yield results. Others worry about the toll on workers and the long-term impact on the sector.

At the same time, Canada faces regulatory pressure, with new rules requiring that 100% of passenger vehicles sold by 2035 must be zero emissions. The clock is ticking, with transportation accounting for 27% of the country’s greenhouse gas emissions, half of which come from light-duty vehicles​.

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