Opinion: Ontario’s tired auto strategy doesn’t work anymore

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Stop the subsidies and cue the entrepreneursLast updated 31 minutes ago You can save this article by registering for free here. Or sign-in if you have an account.Ontario Premier Leader Doug Ford holds up a piece of sheet metal with the words 'PROTECT ONTARIO WORKERS' cut into it at AMBICO Ltd., a manufacturer in Ottawa, Ont., on Feb. 4 2025. Photo by Bryan Passifiume/Toronto Sun filesIts glory days over, Ontario’s auto sector is stumbling towards an embarrassing endgame. Its fatal flaw was doctrinaire policies devised by Ottawa’s self-congratulatory political class and Ontario’s self-appointed economic and trade wizards, who are now in a race to see who can shovel more government “support” into the sector in the name of “protecting” what’s left of this once thriving industry.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountOntario’s automotive output peaked in 1999 when its factories produced a record 3.1 million vehicles. Last year production was only 1.2 million vehicles, which means Ontario has fallen from fourth in the world in auto output to 14th. Over the same quarter century, Canada’s population grew roughly a third, from about 30.6 million in 1999 to roughly 41.5 million today.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againOfficials loved showcasing Ontario’s world-class manufacturing hub, end-to-end supply chain, skilled workforce and strategic integration with global auto markets as key reasons for its premiere status. Now, all that smugness has a hollow ring, with Ontario trailing competitors like Czechia and Türkiye.Employment in the industry has gone the way of output. In 2001 the sector employed 53,204 people at assembly facilities. Now, due to output declines and productivity increases, that’s down to 35,593.The employment-support game soon won’t be worth the subsidy candle. As big labour gets smaller and smaller, government fealty to it should gradually evaporate. For the long run, it’s good news that the knee-jerk strategy of trying to maintain auto sector employment by writing cheque after cheque may soon be doomed.Despite its declining metrics, Ontario continues its expensive “Protect Ontario” mantra, which debuted during Super Bowl weekend in 2025. Its finance ministry spent $21.4 million over the past 17 months almost entirely on the government’s “Protect Ontario” commercials, according to records obtained through freedom of information. The energy ministry spent nearly $10 million on the same messaging during the 2025-26 fiscal year via TV, radio, billboards and social media feeds.Today the destruction part of capitalism’s “creative destruction” is all too evident in Ontario’s auto sector. But the creation part hasn’t yet had its chance. As history teaches, humans often need to experience calamity before shifting out of obsolete paradigms. So it may be for Ontario’s auto sector as it’s strafed by Trumpian tariffs and about to be swamped by Chinese EVs.Canada has abundant automotive capital, both physical and, more importantly for the long run, human. And U.S. President Donald Trump has created a greater appetite for made-in-Canada options. The global automotive market remains gigantic. There is no reason Canada cannot find niches in it and respond to our own demands, as well. All that’s required is for independent automotive R&D to develop sustainable, made-in-Canada automotive models responsive to specific Canadian needs shaped by our vastness and northern location — not to mention the gridlock that often plagues our major cities.Outside Ontario’s legacy political-industrial automotive swamp, there’s no lack of smart, visionary, creative and moneyed Canadians who could take Canada’s auto industry in new directions. But this time it would require giving up on the disaster that “visionary” government auto strategy has brought.Michael Nitefor is founder and president of Toronto-based Air Lab, Inc., an automotive technology company.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.