High dollar dampens auto investment
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The high Canadian dollar threatens to undermine the financial basis for building new automotive assembly plants in...
The high Canadian dollar threatens to undermine the financial basis for building new automotive assembly plants in Canada, according to a study released this week. The study, conducted for the Canadian Automotive Partnership Council, found that a dollar worth US$0.75 would eliminate most of the economic benefits of manufacturing cars in Canada. The Canadian Automotive Partnership council is an industry group that represents auto assembly and parts companies.
The study found that in the past Canadian plants have offered economic advantages to automotive manufacturers; however it also found that the high Canadian dollar, which is currently worth about US$0.76, negates those advantages for plants in Ontario and Quebec. Only one of the last 18 new auto plants built in North America have come to Canada.
The Canadian automotive assembly and parts manufacturing business accounts for 150,000 jobs and generates over $90 billion in total revenue.