Established by McMaster University in 2012 through an Automotive Partnership Canada grant, the Automotive Policy Research Centre (APRC) was formed to examine the role of public policy in facilitating a strong and competitive automotive sector that provides solid jobs in Canadian communities.
The APRC is comprised of an executive board and academic partners and researchers. For more information on these groups, please visit the people section of the site.
- Develop the best evidence based manufacturing policy knowledge related to the automotive sector aimed at improving the global competitiveness of the Canadian automotive industry, increasing investment and maximizing the innovation potential of automotive firms operating in Canada
- Identify appropriate metrics for measuring the strength of the automotive sector in Canada and, as requested by industry partners, produce quarterly reports during the research project (productivity, employment, capital investment, vehicle production, trade balance, etc.)
- Report on the current state of manufacturing policy in Canada and in other automotive producing nations as it impacts the automotive sector
- Report on the impact of various polices such as research and development tax credits, emissions controls and government subsidies used in Canada and in other automotive producing nation
- Identify manufacturing policy options that will assist all three levels of government in Canada to determine how they might facilitate a competitive automotive sector
- Identify manufacturing policy options that will encourage capital investment by automotive and automotive parts producers
- Create and sustain a dynamic network of experts and sector stakeholders that will last beyond the term of this study
- Train highly-qualified personnel (HQP) who will have an in-depth knowledge of the automotive industry and contribute to ongoing innovation and competitiveness
There are currently five themes around which academic partners are focusing their research. Other themes may be added in the future, as we collaborate regularly with industry partners to determine and advance the scope of our research.
An International Comparison of Manufacturing Innovation Policy for the Automotive Industry - David Wolfe
The first phase of David Wolfe’s research examines recent trends in manufacturing innovation policy in the United States, Mexico, Germany, and Spain, with a particular emphasis on how these policies impact the automotive industry. This research found that there was a growing policy convergence between the US, Germany, and Spain. These policies focused on the development and commercialization of several technologies, including lightweight materials, batteries, and information technology products. Furthermore, many of these policies were designed to help strengthen the linkages between firms, public research institutions, and governments, often through multi-level governance structures. This research also found Mexico to be an outlier in the international policy environment. Rather than focusing on the domestic development and commercialization of new technologies and building public-private partnerships to facilitate them, Mexican policies are designed to attract foreign direct investment, primarily through preferential trade agreements.
The second phase of this research focuses on recent policy developments in the US and Germany, and their relevance to the Canadian automotive industry. These policy developments have often taken the form of support for collaborative R&D centres designed to improve the linkages between academic, industry, and government. This phase of the project will examine the extent to which such centres have been established in Ontario and the degree to which they are performing role comparable to related centres in the US and Germany. This phase of the project will address the effectiveness of recent government efforts by posing the following research questions:
1) What are the organizational and operational practices of collaborative centers that aim to develop and diffuse enabling technologies with applications in the automotive sector?
2) What is the impact of these efforts on the competitiveness and increased value-added activities of associated companies within the automotive industry and related sectors?
3) What is the extent to which there can be productive policy learning across political jurisdictions and policy domains?
4) What are the implications of these developments for the role public policy at the federal and provincial levels in Canada and what new policy initiatives should be adopted to provide more effective support for the automotive sector in Ontario?
|Year Investment Announced||Site Type (Greenfield or Brownfield)||Company||Location||Company Investment||Incentive Amount||Incentive as % of Investment||New Job Commitments||Jobs Retained|
|1980||G||Honda||Marysville, Ohio||$240,000,000 @ Marysville initially; $2,000,000,000 in Ohio between 1982 & 1990||$90,000,000 State + Municipal Incentives||5%||8,000|
|1988||G||Honda||East Liberty, Ohio|
|1985||G||GMC||Kansas City, Kansas||$1,000,000,000||$136,000,000||14%||3,000-4,000|
|1992||G||BMW||Greer, South Carolina||$600,000,000||$130,000,000||22%||2,000|
|2000||B||BMW||Greer, South Carolina||$300,000,000||0%||500|
|2003||G||Toyota||San Antonio, Texas||$1,230,000,000||$133,000,000||11%||2,000|
|2006||G||Kia||West Point, Georgia||$1,200,000,000||$410,000,000||34%||2,800|
|2006||B||GMC||Kansas City, Kansas||$651,000,000||$156,000,000||24%||3,900|
|2007||G||Toyota||Blue Springs, Mississippi||$1,300,000,000||$354,000,000||27%||2,000|
|2008||B||BMW||Greer, South Carolina||$750,000,000||0%||1,600|
|2009||B||Daimler (Mercedes)||Vance, Alabama||$290,000,000||$100,000,000||34%||1,000||3,000|
|2010||B||FCA||Sterling Heights, Michigan||$1,015,000,000||$1,313,200,000||129%||800||2,000|
|2011||B||Daimler (Mercedes)||Vance, Alabama||$350,000,000||$12,650,000||4%||400||2,800|
|2011||B||Daimler (Mercedes)||Vance, Alabama||$1,500,000,000||0%||1,400||2,800|
|2012||B||GMC||Kansas City, Kansas||$600,000,000||$120,000,000||20%||0||3,900|
Peter Warrian’s research focuses on the role of policy on innovation in the automotive industry and the automotive industry supply chain. The first phase of his research analyzed the impact of environmental policies on automotive OEMs. His research concluded that different regulatory regimes engendered different technology trajectories. For example, the emphasis on emissions in Europe was linked to innovation in engine and powertrain technologies, while the emphasis on fuel economy in the US led to innovations in lightweight materials. Interviews with industry stakeholders also revealed that these differences have become embedded in the regional platform configurations of OEMs.
The second phase of the project focused on environmental innovation within the automotive supply chain. In collaboration with Mike Smitka from Washington and Lee University, a database was developed that includes 600 winners and finalists of the PACE Awards for innovation in the automotive supply chain. In addition to environmentally-specific items, innovations in lightweight materials in order to meet CAFE standards was found to be an imperative across the industry.
The third phase of the project is a logical extension of the first, and will take place during the 2015 calendar year. It tests the hypothesis that environmental policies impose a greater burden for innovation and technology development on suppliers (as opposed to OEMs). If this is found to be the case, the project will go on to explore the types of policies that best support automotive suppliers to increase their innovative capacity, production technology, and skills in important innovation. Furthermore, this phase of the project will explore the interaction between different policies, and whether or not they add up to create an ‘innovation ecosystem.’
Charlotte Yates and Wayne Lewchuk are exploring the linkages between policy and investment decisions in Canada’s automotive manufacturing industry. In particular, they focus on the roles played by different levels of government in developing and implementing such policies, how firm ownership impacts investment decisions, the importance of financial incentives to investment decisions, and policies that have proven successful in securing past investment.
The project also seeks to determine the benefits and costs of direct and indirect financial incentives for automotive industry investment. The first phase of this research involved literature review, policy analysis, and the collection of other secondary data used to better understand the context in which incentives are provided and to identify where and to what extent incentives played a role in helping secure automotive investment in Canada and the US. An important component of this phase was the development of a detailed database of financial incentives provided to automotive assemblers in exchange for investments in new or existing production facilities in Ontario and throughout the US. The second phase, which is currently well underway, involves interviews with current and former high-ranking municipal, industry, provincial, and federal government officials who have played an active role in developing and implementing policies designed to secure automotive investment. The third stage will involve the analysis of these interviews and the preparation of material for dissemination.
John Holmes and Tod Rutherford are examining the relationship between public policy and the automotive parts manufacturing industry in Canada. More specifically, they seek to understand how the automotive parts manufacturing industry has changed since the high point of the Canadian automotive industry in 2000, and especially since the recent recession, what particular competitive challenges currently face Canadian automotive parts manufacturers, and the relationship between the competitiveness of the Canadian automotive parts manufacturing industry and the public policy environment.
The first phase of their research involved extensive statistical analysis of production, trade, and employment in the Canadian automotive parts manufacturing industry. In addition to several key indicators that demonstrate significant decreases in production, shipments, and employment, they also found that Canada’s automotive parts manufacturing industry is increasingly oriented towards exports to the Great Lakes states (i.e. Michigan, Ohio, Indiana, Illinois, Wisconsin). In 2000, 59% of all Canadian automotive parts exports were destined to Great Lakes states. This figure rose to 67% in 2013. This suggests that Canadian automotive parts manufacturers are becoming increasingly more integrated into, and reliant upon, the cross-border Great Lakes automotive production region focused largely around Ontario and Michigan.
The second phase of their research is to conduct a plant-level survey of automotive parts manufacturers in Canada. This survey seeks to better understand the competitive environment for automotive parts producers, their capacity for product and process innovation, and the threats and opportunities presented by changing vehicle technologies. Several research meetings have been held with the APMA and the Ontario MEDEI in order to assist in the development of the survey instrument. A draft survey instrument was developed in the summer of 2014 and is currently under review by the Queen’s General Research Ethics Board. Once the survey has been finalized in consultation with the APMA and ethics approval is received, the survey will be distributed to the plant managers of automotive parts manufacturing facilities in Canada. The data from this survey will provide a unique insight into the Canadian automotive parts manufacturing industry and provide a foundation for academic and policy-oriented publications.
Working closely with APRC Post-Doctoral Fellow Josipa Petrunic, Ali Emadi’s research focuses on the role of public policy in advancing the electrification of the automotive industry. The first phase of this project involved creating a technology roadmap that outlines the potential trajectories of an increasingly electrified automotive industry. This was the focus of the first ever workshop held by the APRC in February 2013. In addition to technological shifts in the trajectory of the automotive industry, this exercise also sheds light on the cultural and infrastructural shifts that are necessary to facilitate the widespread adoption of new automotive technologies.
The second phase involved an analysis of the technology roadmap in order to determine the role of public policy in advancing an increasingly electrified automotive industry. This involves public policy designed to facilitate both the production and consumption of increasingly electrified automotive products. An emphasis is placed on policies that encourage research and development, production, and employment in an electrified automotive industry in Canada, as well as those that assist in the development of infrastructure to support an electrified transportation industry (e.g. ‘smart grids’, public charging stations) and incentives for consumer to purchase hybrid and electric vehicles (e.g. tax incentives, rebates). As part of this project, a case study of electrified transportation policies in Québec was conducted in order to articulate how such policies can be bundled in order to create an environment that is potentially conducive to the production and widespread consumption of electrified vehicles.