Automotive transformationClick image to enlargeby Andrew Brooks

Market changes creating opportunities for automotive manufacturing in Canada

The automotive industry in Canada is facing some well documented challenges, notably the movement of jobs and manufacturing operations to low-wage countries, as well as tougher environmental laws and the development of new, disruptive technologies such as autonomous vehicles and an economic climate where car owners are keeping their vehicles for longer than ever before, undermining new vehicle sales.

But while it might not seem like a good time for a shop to consider getting into automotive work, the fact is that there is still opportunity in this market. Some industry watchers are positively upbeat.

“The automotive industry across North America has been on quite a roll,” says Dennis DesRosiers, president of DesRosiers Automotive Consultants Inc., a Canadian market research consultancy that specializes in analyzing the automotive sector. “Although the US and Mexico are getting more of the upside, the Canadian auto sector is indeed growing and has stabilized.” DesRosiers projects significant growth to at least 2018, if not through to the end of the decade.

That’s good news for an industry that has seen the lion’s share of capital investment go to the US and Mexico, with figures dwarfing the new investment dollars headed to Canada’s automotive industry. According to a report in the Globe and Mail, in 2014 car manufacturers invested about $13.6 billion in automotive assembly and manufacturing in the US, $9.1 billion in Mexico, and, in Canada, a paltry $977 million, or four per cent of total North American automotive investment for that year.

But it’s the very challenges that Canada’s automotive sector is facing that are driving–or will drive–opportunity for the industry’s manufacturing suppliers. A primary challenge is emerging standards for fuel efficiency. These concerns are motivated by the increasing pace of global climate change, but, interestingly, the drive for improved fuel efficiency hasn’t so far led to a strong uptake of electric and hybrid vehicles. It looks like the internal combustion engine will continue to be the main focus in the search for better fuel efficiency for the foreseeable future.

The Canadian government has committed to falling in line with aggressive US fuel economy standards next year. The two-stage plan, DesRosiers says, calls for new vehicles in the 2025 model year to achieve a fuel efficiency rating of 35 miles per gallon, and 53.5 miles per gallon a decade after that. The timelines seem long, but a sector as massive as the automotive industry takes a long time to change course.

“At this point these are stretch goals that are going to be extremely difficult to meet, so there’s an all-out push at every vehicle company, at every level, to get more fuel efficiency,” DesRosiers says. “Any technology or process that improves fuel efficiency is significant. Any company that has an idea that can move the industry even a tenth of one per cent closer to those goals is going to get the attention of the buyers at the vehicle manufacturers.”

One of the main strategies for improving fuel performance is the use of advanced materials to make vehicles lighter. While in many cases this means the increasing use of advanced composites and even ceramics for the components themselves, the auto makers will also have to retool their production lines extensively, which presents an opportunity for metalworking suppliers. The continuing development of telematics and high-tech engine management systems will also present new opportunities.

Another challenge that has always driven change and innovation in the automotive sector is safety, and it’s likely to become even more of a concern with the development of driverless vehicles. “The hottest topic in automotive right now is autonomous vehicles,” DesRosiers says. “Virtually every technology that touches that issue is related to safety.” Today’s vehicles are safer than they’ve ever been, but making them driverless is going to require a whole new approach to passenger safety, and this will have a huge impact on suppliers to the industry.

“Every single vehicle on the marketplace will have to be completely re-engineered within a decade, or at most 15 years,” says DesRosiers. “That means every set of tooling out there will have to be redone, and all the processes that make the vehicles will have to be re-examined. We’re in for one heck of a ride.” SMT

Tech Tips: Tips for jaw boring

by Stefan Gruber

Avoid unsafe clamping issues

Educating the educators about manufacturing

Manufacturing doesn't have the greatest reputation among the general public and when it comes to youth, it's not often considered as a career choice. The Canadian Tooling and Machining Association (CTMA), along with industry suppliers, want to change that perception and held the first Technolody Day on June 14 in Cambridge, ON, to do just that.

Choose Your Weapon Wisely

by Noelle Stapinsky

Selecting the right torch for your process is a critical decision

Italian machine tools see modest increase

The Italian machine tool industry saw a modest rise in exports of machine tools, but domestic demand remained flat in the fourth quarter of 2013, according to the latest figures from the Italian machine tool association, UCIMU.

Medical Manufacturing: A leg up

by Tim wilson

Prescriptions for success in medical manufacturing

College opens Centre for Smart Manufacturing

Conestoga College officially launched its new Centre for Smart Manufacturing located at the Cambridge, ON, campus of the college's Institute of Technology and Advanced Learning.

Next Level Welding

by Noelle Stapinsky

New advanced solutions for smarter and more efficient welding

Canadian Welding Bureau Group launches new event

The Canadian Welding Bureau Group (CWB Group) and dmg events (Canada) inc. are partnering together to launch a new event for welding, fabricating and metal forming.

Watejet aids in doubling remote copper mine productivity

A five axis waterjet machine from Jet Edge will help a South African mine to double productivity.

Mining opportunities

by Tim Wilson

Finding success in Canada’s resources sector

Bombardier cuts cycle time by 81%

A tombstone application at Bombardier Aerospace's Witchita, KS, plant has helped the manufacturer rack up savings in set up time and reduce cycle times significantly.

Avoiding Weld Faults in Pipelines

by Nestor Gula

There are many factors that can lead to weld defects in pipe welds

Two Toolmakers, Going Crazy

The Problem: Breaking the machine shop status quo without breaking the bank

The Solution: A universal machining centre

Western Canada job shop embraces a new vision with five axis machining technology from Haas

Entry level 5-axis machining

Powerful technology combined with the stable duoBLOCK design make the new DMC 90 U duoBLOCK from DMG Mori an entry level alternative to start productive 5-axis simultaneous machining.

Stay In Touch

twitter facebook linkedIn