Ontario Minister of Economic Development Vic Fedeli is optimistic that landing the crown jewel of an electric battery factory in Windsor, as part of $16 billion in new automaker investments in the province over the past two years, represents just the beginning.
Investment
Billions in new auto investment ‘just the beginning’ — Fedeli
“We have yet to see the full power of Ontario’s (critical minerals) resources unleashed on the automotive sector.”
Fedeli revealed at the Automotive Parts Manufacturers’ Association conference in Windsor this fall that Ontario was in play with six companies on battery plants.
“I think all our prospects are still working through the details,” Fedeli said. “The hope is, with each quarter (of 2023) we’ll have more news.”
Fedeli said landing large chunks of the supply chain for Windsor’s NextStar Energy e-battery manufacturing facility is a key focus and will produce a substantial number of jobs for southwestern Ontario.
Invest WindsorEssex officials are optimistic at least 10 new plants could land in the region. Such a supply chain would also assist in drawing another battery plant to the province.
“The battery plant was $5 billion and suppliers feeding the battery plant could certainly add another $5 billion when all is settled,” Fedeli said.
Fedeli concedes the field is competitive for those investments.
The new Inflation Reduction Act south of the border provides billions in U.S. federal incentives for battery related investments, while individual states offer their own packages.
“That (Inflation Reduction Act) is more a question for the federal government,” Fedeli said. “We continue to hear positive notes from the minister of finance (Chrystia Freeland). Perhaps the next federal budget will have more to say.”
Fedeli said Ontario will focus on going head-to-head with the packages offered by U.S states.
As key points in his sales pitch, he cites the $7 billion reduction in business costs the provincial government has achieved since first being elected; the province’s supply of green energy; the 65,000 STEM grads produced annually; a lower dollar; health care savings for companies; an established manufacturing base; and the second largest tech and automotive cluster, respectively, in North America.
“In many instances, you’ve got to see beyond one-time cash payments. These companies are here for a long time and they’re getting well-educated employees at a lower cost.”
Fedeli notes that the health care savings alone amount to at least $10,000 per Canadian employee compared to the U.S.
With the battery and OEM investments secured, Fedeli said the table is set to land a lithium processing plant and the heavy capital investments required for the mining sector to complete the domestic EV supply chain.
“They (industry) expect the mines of Ontario to deliver that,” Fedeli said.
Fedeli said he’s already met with the operators of four of northwestern Ontario’s lithium mining sites.
The province has been playing the role of matchmaker between the Canadian mining sector and automotive/battery companies in addition to pitching the benefits of locating in Ontario.
“When the Americans talk about a critical-mineral strategy, they’re talking about our minerals,” Fedeli said.
“We want the value-added process to occur in Ontario and have most of the manufacturing done in Ontario. We don’t want to be just hewers of wood and drawers of water.”
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TORONTO – Canada’s main stock index was higher in late-morning trading, helped by strength in energy stocks, while U.S. stock markets also moved up.
The S&P/TSX composite index was up 34.91 points at 23,736.98.
In New York, the Dow Jones industrial average was up 178.05 points at 41,800.13. The S&P 500 index was up 28.38 points at 5,661.47, while the Nasdaq composite was up 133.17 points at 17,725.30.
The Canadian dollar traded for 73.56 cents US compared with 73.57 cents US on Monday.
The November crude oil contract was up 68 cents at US$69.70 per barrel and the October natural gas contract was up three cents at US$2.40 per mmBTU.
The December gold contract was down US$7.80 at US$2,601.10 an ounce and the December copper contract was up a penny at US$4.28 a pound.
This report by The Canadian Press was first published Sept. 17, 2024.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
The Canadian Press. All rights reserved.
TORONTO – Strength in the base metal and technology sectors helped Canada’s main stock index gain almost 100 points on Friday, while U.S. stock markets climbed to their best week of the year.
“It’s been almost a complete opposite or retracement of what we saw last week,” said Philip Petursson, chief investment strategist at IG Wealth Management.
In New York, the Dow Jones industrial average was up 297.01 points at 41,393.78. The S&P 500 index was up 30.26 points at 5,626.02, while the Nasdaq composite was up 114.30 points at 17,683.98.
The S&P/TSX composite index closed up 93.51 points at 23,568.65.
While last week saw a “healthy” pullback on weaker economic data, this week investors appeared to be buying the dip and hoping the central bank “comes to the rescue,” said Petursson.
Next week, the U.S. Federal Reserve is widely expected to cut its key interest rate for the first time in several years after it significantly hiked it to fight inflation.
But the magnitude of that first cut has been the subject of debate, and the market appears split on whether the cut will be a quarter of a percentage point or a larger half-point reduction.
Petursson thinks it’s clear the smaller cut is coming. Economic data recently hasn’t been great, but it hasn’t been that bad either, he said — and inflation may have come down significantly, but it’s not defeated just yet.
“I think they’re going to be very steady,” he said, with one small cut at each of their three decisions scheduled for the rest of 2024, and more into 2025.
“I don’t think there’s a sense of urgency on the part of the Fed that they have to do something immediately.
A larger cut could also send the wrong message to the markets, added Petursson: that the Fed made a mistake in waiting this long to cut, or that it’s seeing concerning signs in the economy.
It would also be “counter to what they’ve signaled,” he said.
More important than the cut — other than the new tone it sets — will be what Fed chair Jerome Powell has to say, according to Petursson.
“That’s going to be more important than the size of the cut itself,” he said.
In Canada, where the central bank has already cut three times, Petursson expects two more before the year is through.
“Here, the labour situation is worse than what we see in the United States,” he said.
The Canadian dollar traded for 73.61 cents US compared with 73.58 cents US on Thursday.
The October crude oil contract was down 32 cents at US$68.65 per barrel and the October natural gas contract was down five cents at US$2.31 per mmBTU.
The December gold contract was up US$30.10 at US$2,610.70 an ounce and the December copper contract was up four cents US$4.24 a pound.
— With files from The Associated Press
This report by The Canadian Press was first published Sept. 13, 2024.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
The Canadian Press. All rights reserved.
TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
The Canadian Press. All rights reserved.
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