Question Period Note: ZERO EMISSION VEHICLES

What is the Government of Canada doing to be a leader in zero emission vehicle (ZEV) manufacturing and consumer adoption?

• Climate action is a cornerstone of the Government of Canada’s plan to create 1 million jobs, transform Canada’s economy and move to a lower-carbon future.

• As part of the ‘A Healthy Environment and a Healthy Economy’ climate plan, the government announced a $3 billion investment in the Net Zero Accelerator fund to make Canada a top destination for investments in clean technology and zero-emission products.

• A further $5 billion was announced for the Net Zero Accelerator as a part of Budget 2021, for a total funding envelope of $8 billion.

• These investments will support projects that reduce greenhouse gas emissions throughout the Canadian economy.

SUPPLEMENTARY MESSAGES

• Climate change threatens Canadians’ health, their way of life, and our planet. The government will continue to deliver climate action, including a plan to exceed Canada’s 2030 climate goal. The government will also legislate Canada’s goal of net-zero emissions by 2050.

• As outlined in Budget 2021, the government will ensure Canada is the most competitive jurisdiction in the world for clean technology companies by reducing the general corporate and small business income tax rate by 50% for manufacturers of zero-emission technologies; expanding eligible equipment; updating the eligibility criteria such that certain fossil-fuelled equipment will no longer be eligible after 2024; and providing a tax incentive for carbon capture, utilization, and storage.

• Ford Motor Company is establishing Oakville as its largest North American battery electric vehicle plant, helping advance the government’s strategy.

• Last fall, Unifor and General Motors Canada announced an agreement that includes a $1 billion investment to produce electric commercial vans at the CAMI Assembly Plant in Ingersoll, Ont.

• During these same negotiations, Unifor and FCA announced an investment of up to $1.58 billion for a state-of-the-art platform to build both plug–in hybrid vehicles and battery electric vehicles at its Windsor assembly plant.

If pressed on battery supply chain:

• Building a battery supply chain to support electrification will enable Canadian plants to compete for new mandates.

• Canada has competitive advantages: natural resources and the scientific excellence and manufacturing skills to maximize them.

• More specifically, Canada is the only nation in the Western Hemisphere with an abundance of cobalt, graphite, lithium and nickel, the minerals needed to make next-generation electric batteries.

• Support for the development of a Canadian battery innovation and industrial ecosystem is a key pillar of the government’s investment through SIF NZA, as outlined in its strengthened climate plan.

To support the transition to a low-carbon transportation system, the government set targets for sales of ZEVs in Canada (10% of new light-duty vehicle sales to be ZEVs by 2025, 30% by 2030, and 100% by 2040). These targets will support Canada’s commitment to reach net zero emissions by 2050 and its pledge at the United Nation’s 2019 Climate Action Summit.

The International Energy Agency (IEA) reports that in 2020 the global ZEV car stock
hit the 10 million mark, a 43% increase over 2019, and representing a 1% stock share. The IEA forecasts that by 2030, production of electric vehicles could reach 43 million units per year, with production valued at more than US$567 billion. By 2040, the international market for energy storage will attract US$662 billion in investments. The lithium ion battery is at the heart of this evolution.

Canadian ZEV production

At this time, Canada only produces one ZEV – the Stellantis Pacifica plug-in hybrid electric vehicle produced at their Windsor Assembly Plant. However, by mid-decade the Canadian production mix will pivot significantly towards electrified vehicles following Unifor agreements with the Detroit 3. The manufacturing of ZEVs in Canada will also have positive affects on the Canadian supply chain for parts, suppliers and for battery mining and assembly.
• Ford - $1.95 billion investment to transform Oakville to battery electric vehicle production (up to 5 vehicles), securing 3,000 jobs by 2027.
• GM - $1.94 billion investment into Oshawa and St. Catherines, and $1.42 billion for the CAMI Facility in Ingersoll, Ontario to transition to assembly of battery electric commercial vans under GM’s new BrightDrop brand.
• Stellantis - $1.43-$1.58 billion investment to retool the Windsor facility for multi-energy vehicle architecture, including plug-in hybrid elective and battery electric vehicles.

Canada is one of the only countries in the Western Hemisphere with all of the minerals (cobalt, graphite, lithium and nickel) required to manufacture batteries. Establishing a battery manufacturing supply chain will allow us to accelerate the transition of Canada’s existing automotive and transportation sector to support electrification, making Canada’s companies more competitive for new mandates, and supporting the attraction of new players in the electric vehicle space.

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