Agreement with #German automakers ‘unprecedented’ for #Canada, says auto industry insider
Memorandums of understanding the federal government signed with two of Europe’s largest automakers are unprecedented, according to the president of Canada’s Automotive Parts Manufacturers’ Association.
On Tuesday the federal government announced it reached agreements with Volkswagen and Mercedes-Benz that would help the German automakers secure access to the critical minerals needed for electric vehicle batteries.
Those critical minerals – such as lithium, nickel, cobalt and graphite – are primarily found in parts of northern Ontario and northern Quebec.
“It is absolutely unprecedented,” said Flavio Volpe, president of the Automotive Parts Manufacturers’ Association.
He said the agreements with both companies sends a signal to other car manufacturers that northern Ontario and northern Quebec are the places to access critical minerals if they want to qualify for new electric vehicle tax credits in the U.S.
To qualify for the new tax credits in the U.S. – which are worth up to $7,500 for electrical vehicle buyers – automakers must manufacture their vehicles in North America, and source most of their critical minerals and battery materials from countries that have a free-trade agreement with the U.S.