What is Canada's auto industry concentrated around?

Canada's automotive industry is concentrated in southern Ontario, where five global automakers operate vehicle-assembly plants and a network of suppliers produces parts for both Canadian and U.S. assembly lines. Annual production is about 1.4 million vehicles, of which roughly 85 per cent are exported, primarily to the United States under the Canada-United States-Mexico Agreement. The industry directly employs about 130,000 Canadians and supports many more in tooling, logistics, and dealerships.

The five vehicle assemblers are Ford Motor Company of Canada (Oakville Assembly), General Motors of Canada (Oshawa Assembly and the CAMI plant in Ingersoll), Stellantis (Brampton Assembly and Windsor Assembly, the latter producing the Chrysler Pacifica minivan), Honda Canada (Alliston Assembly Plant 1 and Plant 2, the world's largest Honda plant outside Japan), and Toyota Motor Manufacturing Canada (Cambridge Assembly Plant 1 and 2 plus Woodstock Assembly, producing RAV4 and Lexus RX models). About 700 parts and components suppliers operate across the corridor from Windsor to Oshawa.

The history of Canadian auto manufacturing began with the Oshawa Carriage Works (founded 1876, became GM Canada in 1918), Ford's first Canadian assembly plant in Walkerville (1904), and Studebaker in Hamilton. The Canada-United States Auto Pact of 1965 first integrated the North American auto industry, granting Canadian-built vehicles duty-free access to the U.S. in exchange for production guarantees. NAFTA (1994) and CUSMA (2020) succeeded the Auto Pact and tightened North American content rules to 75 per cent of vehicle value.

Federal and Ontario governments have committed multi-billion-dollar incentive packages to anchor electric-vehicle manufacturing. The Stellantis-LG Energy Solution NextStar battery plant in Windsor (announced 2022, $5 billion in capital cost plus up to $13 billion in production credits), Volkswagen's PowerCo plant in St. Thomas (2023, $7 billion in production credits), Honda's Alliston EV ecosystem (2024, $5 billion), and Northvolt's Saint-Basile-le-Grand plant in Quebec (2023, $7 billion across federal and provincial commitments) together represent the largest single industrial investment commitment in Canadian history. The Canada Infrastructure Bank, the Strategic Innovation Fund, and federal Investment Tax Credits anchor the competitive package.