The Canadian Auto Parts Manufacturers Association (APMA) supports the renewal and modernization of the USMCA to strengthen the economic security and competitiveness of the North American automotive industry in the face of competition from China.
North America’s position in the global automotive market depends on the current cooperation detailed in the United States-Mexico-Canada Agreement (USMCA) and further cooperation will likely be required in the future as China continues to invest in electric vehicle production, battery supply chains and advanced manufacturing. A fragmented North American market risks falling behind and losing its leadership position.
“Heavily subsidized Chinese automakers create overcapacity in the global automotive market that threatens to distort the market and erode the industrial bases of the three countries that make up the USMCA. In addition, the stamping subsector, vital for both auto assembly and auto parts manufacturing, is threatened by these unfair trade practices,” APMA stated in comments sent to the Office of the United States Trade Representative for the next review of the USMCA.
The Canadian-American cluster established in Ontario and Michigan has been harmed by predatory practices by Chinese competitors who flood the market with products at low prices, even below the cost of raw materials, APMA highlights. “Canadian auto parts manufacturers strengthen US competitiveness and resilience by supplying high-quality, cost-effective components that allow US plants to operate smoothly. Likewise, Mexican production provides capacity, labor flexibility and integration that allows US and global automakers to expand in the region,” said Flavio Volpe, president of APMA.
To strengthen the USMCA, APMA proposed simplifying regulatory compliance with the rule of origin, supporting the transition to electric vehicles, harmonizing digital customs systems, improving SMEs’ access to the supply chain, and strengthening the dispute resolution mechanism.
According to the association, the USMCA has encouraged greater integration, an increase in investments, regional content and employment in North American automotive production.
