Driving changeClick image to enlargeby Tim Wilson

Market shifts hold the future for auto manufacturing

With the Canadian dollar hovering around US $0.80, Canadian manufacturers have been given some breathing space. But experts say it would be folly to use this as a crutch to avoid required investments in technology and highly skilled labour–two areas where Canada shines. This is particularly true given that Mexico is now competing on higher value production.

“What is worrying for Canada is that Mexico is developing advanced manufacturing,” says Dr. Sean McAlinden, executive VP of research and chief economist at the Center for Automotive Research (CAR) in Ann Arbor, MI.

Growth in automotive assembly in North America has gravitated towards Mexico and the southeast US. Canada has not been successful in landing new plants, though the current OEMs have made important reinvestment decisions here. As well, Canada has a strong assembly footprint, buffered by provincial and federal government partners. To sustain things for the long haul, however, the industry has to build on its strengths.

“Innovation is the key differentiator for Canadian suppliers to enter the customer supply chain,” says Flavio Volpe, president of the Automotive Parts Manufacturers Association (APMA). “We are not competitive on a commodity basis, but we have developed a culture of investment in product and process development to build a global reputation as a centre for innovative design and execution.”

A competitive dollar can help. “The dollar at 80 cents will help some suppliers,” says McAlinden. “The Canadian and US industries are tied together–a tremendous amount of parts are sent across from Michigan every day, and the same is true of Ontario-based suppliers shipping to the 12 plants located here.”

Given that 90 per cent of North American components are typically sent with 250 miles of a plant, Ontario has a built-in advantage. As well, the recent shift in the currency keeps us competitive with Mexico.

“The more favourable exchange rate we have been experiencing over the past few months is interesting and advantageous,” says Volpe. “As the Mexican peso continues to keep pace with the Canadian dollar, there may be some advantage for supplier spend in Canada versus the US for Mexican-based customers, and Canadian companies may be able to make some incremental gains.”

But Flavio also notes on a long-term structural basis, it is difficult from a supply standpoint to envision the advantage will have any permanent effects. After all, customers adjust their expectations, and input costs continue to be quoted in US dollars. And observers like McAlinden are not without criticism of how Canada has approached the market. “The problems for Canada are that it has relied too much on cheap labour based on the Canadian dollar. The Canadians didn’t invest in technology, and they didn’t care what products they were making.”

One positive development for the Canadian market has been the arrival of Stephen Carlisle as president of General Motors of Canada Ltd. He has been vocal about GM’s commitment to Canada, and the industry’s long-term viability. “Mr. Carlisle has taken it upon himself to reach out directly to the supply community and engage with them on the dynamics of investment decisions at GM,” says Volpe.

As it stands, Carlisle has been reluctant to play his hand with regard to GM Canada’s future commitments. It is on a solid footing with labour and government relations, but there have been rumblings it could pull out of Oshawa, ON, after 2017. SMT

Tim Wilson is a contributing editor. This email address is being protected from spambots. You need JavaScript enabled to view it.

Submerged arc flux for offshore welding

Lincoln Electric has introduced a new submerged arc flux designed for welding requirements for the offshore construction industry.

Deposition rates of 60 lb/hr

Lincoln Electric has introduced a self-propelled modular CruiserTractor designed for increased mobility and equipped with operator-friendly features for longitudinal submerged arc welding applications common in bridge and barge decking, large tank fabrication and shipbuilding.

Equipment, funding for student welding programs

The CWA Foundation has launched the Secondary and Post-Secondary Institution Equipment and Funding Support program to help improve the quality of welding facilities across Canada.

Wilson Tool celebrates new Canadian manufacturing plant

Wilson Tool's newest manufacturing plant in Canada, a 4,366 sq m (47,000 sq ft) facility in Toronto, is one of seven production facilities the company operates around the around the globe, and it's one of two operations in Canada.

Ferro Technique expands sales team

Ferro Technique has expanded its sales force with the promotion of Roger Jeffries, sales manager, and the addition of Wayne Felker, regional sales representative.

Controlled machining

by Harsh Bibra and Todd Drane

How controls contribute to better precision machining performance

When you’re machining tight tolerances in the range of 0.013 to 0.003 mm (+/- 0.0005 to 0.0001 in.) controls play a critical role in ensuring those parameters are maintained.

Choosing an annular cutter

There is more than one type of annular cutter for different alloys

Automatic air carbon-arc gouging unit boosts speeds by 5x

­Arcair, a Victor Technologies brand, has introduced the Arcair-Matic N7500, an automatic gouging system that offers five times greater productivity and 10 times faster clean-up compared to manual carbon arc gouging, claims the company.

Northern Ontario college adds women's welding program

Collège Boréal, a French language post secondary institution in Kapuskasing, Ont., has announced a new 20-week welding program for Indigenous women.

GF AgieCharmilles changes name to GF Machining Solutions

GF AgieCharmilles has changed its name to GF Machining Solutions to better reflect the company's divisions. GF's technology offerings include milling, EDM, laser texturing, spindles, tooling and automation.

Going green

by Kip Hanson

Scarborough company aims to be the first manufacturer off the grid

Tired of your old office furniture? According to the US Environmental Protection Agency, consumers discard several million tonnes each year of used chairs, desks, and cubicles.

A machine tool builder's approach to Industry 4.0

Heller Machine Tools has embraced the Factory of the Future and is setting an example of how manufacturers can do the same. The company is one of several machine tool builders (i.e. Mazak's iSmart factory) in recent years that has embraced digital manufacturing concepts in their facilities. 

Rohm, ATS roadshow comes to Canada

Rohm and ATS Sytems formed a partnership earlier this year and launched the new business arrangement with a North American tour of Driving Innovation-A Mobile Technology Centre, a demonstration showroom housed in a 16 m (53 ft) tractor trailer, featuring workholding, automation and machine tool accessories. The ATS roadshow hit Ontario in early April.


by Kip Hanson

The Problem 
New machine, increasing part complexity required new toolpath software

Inspection techniques

As anyone in the fabricating and welding business knows, process and part inspection is a critical component of a successful business. Build and weld a poor part will simply guarantee failure.

Stay In Touch

twitter facebook linkedIn