Over the past ten years, there has been a decrease in car production by the Detroit Three automakers in Canada. However, Japanese car manufacturers have maintained a stable presence in the country, as revealed in a recent analysis by the Trillium Network for Advanced Manufacturing at Western University. The report indicates a decline in the total number of cars produced in Canada, dropping from 2.3 million in 2016 to 1.2 million by 2025.
The reduction in car production is primarily attributed to decreased output from U.S.-based automakers Ford, Stellantis, and General Motors, collectively known as the Detroit Three. In 2016, these companies accounted for 56% of Canadian car production, which decreased to 23% by 2025. In contrast, Japanese automakers Honda and Toyota saw an increase in their share from 44% to 77% during the same period.
The report also highlights shifts in employment at assembly plants, with jobs at Japanese car companies surpassing those at the Detroit Three. While U.S.-based automakers accounted for 60% of assembly employment in 2015, this figure dropped to 38% by 2024. In comparison, jobs at Japanese companies constituted over 60% of auto assembly employment in 2024.
According to Brendan Sweeney, the managing director of Trillium Network, the changing dynamics reflect different business priorities set by U.S. and Japanese automakers in Canada. The popularity of certain Japanese models, like the Honda Civic and Toyota’s Rav 4, in North America has contributed to the sustained production by Japanese manufacturers in Canada.
On the other hand, recent developments in the industry include GM’s decision to halt production of BrightDrop electric delivery vans in Ingersoll and cut a shift at its Oshawa plant, leading to potential job losses. Stellantis and Ford have also temporarily closed facilities for retooling, with ongoing adjustments at various plants to meet changing market demands.
The impact of U.S. President Donald Trump’s tariffs on the auto industry has been significant, with Canadian-made vehicles facing a 25% tariff. However, Brian Kingston, president of the Canadian Vehicle Manufacturers’ Association, emphasizes the broader contributions of the Detroit Three to research, development, and parts production in Canada.
As the federal government prepares to unveil its automotive strategy, stakeholders like Flavio Volpe, president of the Automotive Parts Manufacturers’ Association, advocate for rewarding companies committed to investing in and producing cars in Canada. Incentives to encourage such investments could play a crucial role in sustaining the automotive industry in the country.