Auto Canada
What are the current competitive advantages facing the auto industry in Canada??
- what are the current threats facing the auto industry in Canada?
1a) Canada has a number of advantages over its southern neighbour. It is basically cheaper here in Canada to deal with unions then it is in the United States for one simple reason "universal health care" in the US, companies are obliged in many cases to provide all-encompassing health insurance to their employees, while in Canada, private health insurance is far cheaper considering the universal system covers the mostly costly procedures.
2) a) In terms of threats, there are two dimensions. First, the Canadian public have shifted gears away from buying American-made vehicles to foreign automakers, this has severely impacted the domestic auto industry (GM/Daimler Chrysler) who are the largest auto employers in Canada. Foreign automakers tend to have their vehicles (especially parts) made/assembled in cheaper locales such as South Korea & Taiwan. (While there are foreign automaker plants in North America, they receive all of their parts from foreign countries)
b) The second dimension is that foreign automakers benefit from the protectionist policies many countries have (especially Asian automakers). See, countries such as Japan and South Korea, do NOT allow North American automakers into their marketplace, unlike Canada and the US which is open to foreign automakers. Simply put, Toyota has a 35% marketshare in Japan, (the rest of the marketshare is shared by other Japanese automakers, see the first source) so they always have a stable revenue flow and are not susceptible to consumer trends as are North American automakers.
Below I also listed a link to the Canadian Auto Workers website, its an excellent resource for info regarding the auto industry.
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