Skip to main content
Sister Publication Links
  • European Rubber Journal
  • Plastics News
  • Tire Business
Subscribe
  • Login
  • Register
  • Subscribe
  • News
    • Automotive
    • Tire
    • Non-Tire
    • Suppliers
    • Silicone
    • Online Exclusive
    • Latex
    • Technical Notebooks
    • Executive Action
    • Government/Legal
    • Opinion
    • Rubber Division IEC
    • ITEC
    • Blogs
    • Sustainability
    • Products
    • Wacky World of Rubber
  • War in Ukraine
  • Custom
    • Sponsored Content
    • White Papers
  • Resources
    • Directory
    • Classifieds & Mold Mart
  • Data
  • Events
    • RN Events
    • RN Livestreams/Webinars
    • Industry Events
    • Past Events
    • Rubber News M&A Live
    • 2022 Hose & Belt Manufacturers Conference
    • 2022 International Silicone Conference
    • 2022 International Tire Exhibition & Conference (ITEC)
  • Advertise
  • DIGITAL EDITION
MENU
Breadcrumb
  1. Home
  2. Government - Legal
February 18, 2020 05:38 PM

Magna CEO says USMCA will mean 'more jobs, more investment' in Canada

John Irwin
Automotive News Canada
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print
    Don Walker said the USMCA makes the North American region as a whole more competitive with the rest of the world, particularly China.

    TORONTO—The new U.S.-Mexico-Canada Agreement should bring more jobs and investment to Canada, provided details surrounding local content and labor requirements are sorted out, Magna International Inc. CEO Don Walker said.

    "There's a lot of detail here, but, overall, I think it will be good for the industry," Walker said at the Automotive News Canada Congress in Toronto Feb. 13. "There should be more jobs here and more investment here and more trading with great trading partners, the U.S. and Mexico."

    In order to ship between the countries duty-free under the USMCA, 75 percent of a vehicle's content must be sourced from within the three countries, up from 62.5 percent under the North American Free Trade Agreement. It also requires 40 percent to 45 percent of parts on a vehicle to be made by workers who make at least $16 (C$21.21) per hour.

    The deal was designed by the three countries to level the playing field after auto makers, under NAFTA, opened numerous assembly plants in Mexico due to its cheaper labor costs. Suppliers in Canada have expressed optimism that regional content requirements would increase business for them. The Automotive Parts Manufacturers' Association estimated the USMCA would bring in up to C$8 billion (in additional annual parts orders in Canada.)

    Walker said the USMCA makes the North American region as a whole more competitive with the rest of the world, particularly China.

    In launching trade discussions in North America, the U.S.' "real objective (was) to level the playing field with China," he said. "I think it was probably 10 years too late, and they'd probably admit that. But China is going to roll over (North America) if we don't get a stronger position and better negotiation with them. They're a scary competitor."

    Walker cautioned that the transition from NAFTA to the USMCA's rules could be too quick to allow the industry to properly understand and adjust to new regulations. Under the terms of the deal, the USMCA will go into effect 90 days after the final country ratifies the deal. Canada has yet to ratify the bill, while the U.S. and Mexico have.

    Walker said he said he wrote a letter to Deputy Prime Minister Chrystia Freeland and U.S. Trade Representative Robert Lighthizer, urging them to push that back to the start of 2021.

    "We're going to have to make sure all the OEMs approach it the same way, but there's no way we're going to get it done," he said. "The fact is regional value content is going up. That should mean there's going to be more local sourcing, unless it gets so complicated where they can't meet the target, in which case somebody may say, 'I'm going to make the vehicle outside of NAFTA, pay the duty and ship it in.'"

    Walker also warned that if wages rise too quickly in Mexico as a result of the new trade pact, supply work could go overseas where it might still be cheaper.

    "Be careful what you wish for," he said.

    Prime Minister Justin Trudeau's Liberal Party, now in a minority, requires votes from one of the opposition parties in Parliament in order for Canada to ratify the agreement. Walker urged the House of Commons to move quickly to ratify the USMCA.

    "I hope there's not going to be a lot of political debate for the sake of political debate," he said. "I think it will get passed. You can't really change it at this point."

    Letter
    to the
    Editor

    Rubber News wants to hear from its readers. If you want to express your opinion on a story or issue, email your letter to Editor Bruce Meyer at [email protected].

    Most Popular
    1
    U.S. tire market continues to attract new players
    2
    Diversity focus, cultural shift needed to combat labor shortage
    3
    Stellantis ranked lowest in supplier relations study
    4
    Technical Notebook: Opportunities and threats for rubber products
    5
    Stakes high as global NR industry urgently seeks alternate supply
    SIGN UP FOR NEWSLETTERS
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please verify captcha.

    Please select at least one newsletter to subscribe.

    Get our newsletters

    Staying current is easy with Rubber News delivered straight to your inbox, free of charge.

    Subscribe Today

    Subscribe to Rubber News to get the best coverage and leading insights in the industry.

    SUBSCRIBE
    Connect with Us
    • LinkedIn
    • Facebook
    • Twitter

    MISSION

    To serve companies in the global rubber product industry by delivering news, industry insights, opinions and technical information.

    Contact Us

    2291 Riverfront Pkwy, Suite 1000
    Cuyahoga Falls,
    OH 44221

    Customer Service:
    877-320-1726

    Resources
    • About Us
    • Digital Edition
    • Staff
    • Advertise
    • Order Reprints
    • Privacy Policy
    • Privacy Request
    • Terms of Service
    • Careers
    • Ad Choices Ad Choices
    • Sitemap
    Partner Sites
    • Tire Business
    • European Rubber Journal
    • Plastics News
    • Plastics News China
    • Urethanes Technology
    • Automotive News
    • Crain Brands
    Copyright © 1996-2022. Crain Communications, Inc. All Rights Reserved.
    • News
      • Automotive
      • Tire
      • Non-Tire
      • Suppliers
      • Silicone
      • Online Exclusive
      • Latex
      • Technical Notebooks
      • Executive Action
      • Government/Legal
      • Opinion
      • Rubber Division IEC
      • ITEC
      • Blogs
        • Products
        • Wacky World of Rubber
      • Sustainability
    • War in Ukraine
    • Custom
      • Sponsored Content
      • White Papers
    • Resources
      • Directory
      • Classifieds & Mold Mart
    • Data
    • Events
      • RN Events
        • 2022 Hose & Belt Manufacturers Conference
        • 2022 International Silicone Conference
        • 2022 International Tire Exhibition & Conference (ITEC)
      • RN Livestreams/Webinars
      • Industry Events
      • Past Events
      • Rubber News M&A Live
    • Advertise
    • DIGITAL EDITION