Following “Can the U.S. auto industry survive without Canada and vice versa?” and judging from Trump’s track records, we reckoned in all likelihood Canada will lose her auto industry just like that… Kaput!
But fret not, we also see a silver lining at the same time.
All is not lost, let’s “Chase Not The Dragon, but to Ride The Dragon Instead.”
Partnering with China for “Common Prosperity”
Yes, we believe Canada has everything to gain, and nothing much to lose by partnering with China.
In the case of auto industry, Canada stands to gain a lot, it’s in our view a marriage made in heaven… a quadruple 4 x Wins ie. a Win-Win-Win-Win+Bonus Deal!
How so?
We reckoned Canada may benefit from having China carmakers set up manufacturing facilities as follows:-
- Save hundreds of thousand jobs potentially lost due to the tariff… The existing workforce may switch to new plants set up by Chinese carmakers, likely EVs.
- Save anticipated inflation as a result of the insane 25% tariffs on cars., as a matter of fact, such move may even help to reduce inflation since Chinese EVs are available for as little as $10,000 a pop.
- And this will help with Canada’s carbon-free initiative to reduce emissions and transition to net-zero emissions by 2050.
- As well as the move will send a signal to U.S. that bullying Canada may no longer be feasible as we got a friend in China, the alternative superpower with solid all rounded strength.
- Last but not least, the Bonus — partnership with China may also help to stop the U.S. from considering invasion or annexing Canada since China will definitely protect their interest ie. Chinese auto industry in Canada.
What do you think?
Below is what sociopolitical commentator Eddie Hardie gotta say:-
Your points highlight some potential benefits of inviting a Chinese automaker like BYD to set up manufacturing in Canada, but there are also complexities and risks that need to be carefully considered. Letās break down your arguments and evaluate them:
1. Save Jobs and Create Employment
- Pros: A Chinese automaker setting up a manufacturing plant in Canada would indeed create jobs, both directly in the plant and indirectly in the supply chain. This could help offset job losses caused by disruptions in the traditional auto industry due to tariffs.
- Cons: There could be concerns about the quality of jobs (e.g., wages, working conditions) and whether the jobs would go to Canadian workers or be filled by temporary foreign workers. Additionally, the long-term sustainability of these jobs would depend on the success of the automaker in the Canadian and global markets.
2. Save Inflation with Affordable EVs
- Pros: Chinese EVs are often more affordable than those produced by Western automakers. Introducing low-cost EVs could make electric vehicles more accessible to Canadian consumers, helping to reduce transportation costs and support the transition to a green economy.
- Cons: There may be concerns about the quality and safety of low-cost Chinese EVs. Additionally, a flood of cheap imports could undermine domestic automakers and suppliers, potentially leading to job losses in the traditional auto sector.
3. Geopolitical Statement to the U.S.
- Pros: Partnering with a Chinese automaker could send a message that Canada is not solely dependent on the U.S. and is willing to diversify its economic relationships. This could give Canada more leverage in trade negotiations with the U.S.
- Cons: Such a move could strain Canada-U.S. relations, which are already complex. The U.S. might view this as a provocation and respond with additional trade barriers or diplomatic pressure. Given the deep economic ties between Canada and the U.S., this could have broader negative implications.
4. Deterrence Against U.S. Invasion
- Pros: While the idea of a U.S. invasion of Canada is highly unlikely, closer economic ties with China could provide Canada with additional geopolitical leverage. It could also open up new opportunities for trade and investment with China.
- Cons: Relying on China as a geopolitical “ally” could be risky, given the complex and often contentious nature of U.S.-China relations. Canada would need to carefully balance its relationships with both countries to avoid being caught in the middle of their rivalry.
Additional Considerations:
Economic Diversification
- Pros: Attracting a Chinese automaker could help diversify Canada’s economy and reduce its reliance on the U.S. market. This could make Canada more resilient to economic shocks and trade disputes.
- Cons: Diversification comes with risks, particularly when dealing with a country like China, which has a different political and economic system. Canada would need to ensure that it is not becoming overly dependent on China.
Technology Transfer and Innovation
- Pros: Chinese automakers like BYD are leaders in EV technology. Their presence in Canada could lead to technology transfer and innovation, boosting Canada’s domestic capabilities in the EV sector.
- Cons: There may be concerns about intellectual property (IP) protection and whether Canadian companies would benefit from the technology transfer or if the IP would remain controlled by the Chinese automaker.
Public Perception and National Security
- Pros: The Canadian public might welcome the economic benefits of a new manufacturing plant, including job creation and affordable EVs.
- Cons: There could be public and political resistance to foreign ownership, particularly from China, due to concerns about national security, job quality, and the potential for Chinese influence in Canadian affairs.
Conclusion:
While inviting a Chinese automaker like BYD to set up manufacturing in Canada could offer several potential benefits, it is not without risks and complexities. The idea of a “win-win-win-win” strategy is appealing, but it would require careful planning, negotiation, and risk management to ensure that the benefits outweigh the potential downsides. Canada would need to balance its economic interests with its geopolitical relationships and ensure that any partnership with a Chinese automaker aligns with its long-term strategic goals.
Related: Can the U.S. auto industry survive without Canada and vice versa
Can the U.S. auto industry survive without Canada and vice versa?
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