The Government of Canada is committed to fostering the research and development necessary to keep Canada's automotive manufacturing sector innovative and globally competitive.
In keeping with this goal, Prime Minister Harper announced that Toyota Motor Manufacturing Canada (TMMC) will receive a repayable contribution of up to $16.875 million from the Automotive Innovation Fund (AIF).
Project Lexus
TMMC is investing to increase production of the Lexus RX 350, and begin the production of the Lexus RX 450h hybrid in Cambridge, Ontario. The project will involve building a new blended assembly line that will permit the production of both the current model Lexus and the hybrid model.
Benefits
Production of the RX 450h hybrid in Cambridge will mark the first hybrid model to be built by TMMC, as well as the first Lexus hybrid produced outside of Japan. The project will provide short- and long-term economic benefits to Canada including job creation and retention, opportunities in research and development (R&D), and increased activities within the Canadian supply chain. The project will help strengthen Canadian production capabilities, technology development and academic collaboration within the automotive industry.
Project Lexus is expected to generate approximately 400 jobs at TMMC's Cambridge facility.
The Automotive Innovation Fund (AIF)
On January 4, 2013, Prime Minister Harper announced the renewal of the AIF, confirming the Government of Canada's ongoing commitment to creating jobs, growth, and long-term prosperity for all Canadians.
The renewed Fund will provide $250 million over five years (2013-2018) to automotive companies in Canada in support of strategic, large-scale research and development projects. This support builds on the initial commitment of $250 million over five years, introduced in Budget 2008.
The Government of Canada will consider investment proposals valued at more than $75 million. Each proposal for AIF support will be subjected to a comprehensive due diligence process to assess the project's feasibility and risk, as well as its ability to deliver the proposed innovation, technical, environmental and economic benefits.
The Automotive Innovation Fund aims to:
- build automotive R&D capacity in Canada and secure high value jobs;
- enhance the Government of Canada's science and technology (S&T) and environmental agendas;
- support the development, implementation and commercialization of advanced and green technologies, and advanced products or processes;
- promote long-term economic benefits to Canada, including significant job creation and retention; and,
- serve as a catalyst for further private sector investments to foster Canadian competitiveness.
The Automotive Innovation Fund supports:
- leading-edge engineering and design, and prototype development;
- new product development, including advanced emissions technologies, energy-efficient engines and transmissions, and
- advanced materials such as engineered plastics and lightweight components and materials;
- advanced product testing with a view to ensuring cleaner, more efficient automotive performance and reducing greenhouse gases;
- the development of new production methods and process technologies, including advanced flexible manufacturing techniques;
- new and expanded facilities to produce leading-edge, energy-efficient vehicles and powertrains; and,
- the introduction of other transformative new production technologies to substantially increase productivity and efficiency, such as robotics and advanced information technologies systems.
To date, the AIF has provided repayable contributions to four companies, including up to:
- $80 million towards an investment of up to $730 million by Ford Motor Company of Canada to establish a flexible engine assembly plant and create an advanced powertrain research centre in Windsor, Ontario;
- $54.8 million towards an investment of up to $365 million by Linamar Corporation to develop and commercialize advanced components and modules within three product areas: transmissions, engines and drivelines;
- $70.8 million towards an investment of up to $506 million by Toyota Motor Manufacturing Canada Inc. to maximize production efficiency, reduce emissions and upgrade equipment to permit the production of more fuel-efficient vehicles including electric vehicles; and,
- $21.7 million towards an investment of up to $199 million by Magna International to develop energy-efficient components for vehicles and innovative powertrain components for next-generation vehicles.
To date, investments have leveraged up to $1.6 billion in R&D and innovation investments in Canada's automotive sector and are contributing towards:
- economic activity and employment in the assembly and supplier ecosystem, and broader economy;
- the development and commercialization of new products including advanced materials and emissions technologies, including the reduction of greenhouse gas emissions;
- advanced and expanded flexible manufacturing processes and facilities;
- enhanced research and development capacity;
- leading-edge engineering and design; and,
- made-in-Canada innovation.
Other Support to the Canadian Automotive Sector
The AIF has and continues to be part of the Government of Canada's broader approach to create the right economic conditions that support a strong Canadian auto industry.
The Government of Canada's approach also includes a fiscal and economic framework that will keep the industry competitive, including:
- a sound banking system;
- the lowest overall tax rate on new business investment in the G-7;
- the lowest debt-to-GDP ratio in the G-7;
- a triple-A credit rating;
- support for an integrated North American automotive assembly and supplier ecosystem such as the Windsor-Detroit Bridge; and,
- investments in automotive research and development, including Automotive Partnership Canada, and Auto 21.
Additionally, in 2009, the Government of Canada and the Government of Ontario provided unprecedented support to General Motors and Chrysler to protect the automotive sector, a key economic driver of the Canadian economy
