HANNAFORD: How Ottawa pays corporations $40 billion to make cars nobody wants

How very like the Trudeau Liberals to subsidize the production of cars that Canadians don't want to buy. Is everybody in Cabinet so busy watching CBC that they have no time to check out Fox News?Like much else this government does, it’s the kind of thing the Communist central planners did in the old Soviet Union… or today in China where the landscape is dotted with ghost apartments in which nobody wants to live and come to think of it, also fields where new electric cars are stored, that nobody wants to buy.Somebody’s interest is being served, but not that of the taxpayer.Or the person wanting reliable, daily transportation. .It’s all a bit hard to believe. But just track the headlines for the last three weeks.1) Ford pushes EV production at Ontario plant back two years, affecting 2,700 jobsThe delay is to give “the consumer market more time to develop” the company said, while allowing for further development of EV battery technology. 4th April 20242) Musk comes unplugged as Tesla plans to slash 10% of its workforce as EV rout continuesIn this case, the company cites production problems caused by attacks on shipping in the Red Sea and an arson attack on its factory in Berlin. However, industry watchers said the real problem is falling demand. 16th April 20243) Europe ‘returning to petrol’ as VW’s EV sales slump 25%Here the story was exactly what the headline said, EV sales way down, but worldwide sales of gas jobs up by 4%. 17th April 20244) Ford loses more than $100K on each EV it made — or sold — in Q1As my friend and colleague Shaun Polczer wrote, “The bean counters at Ford are finally learning to do the maths when it comes to the true cost of making and selling EVs. That’s because the company’s Model e all-electric unit reported first quarter losses that exceeded USD$1.3 billion on falling sales of just 10,000 vehicles in the US and Canada, which itself was down 20% from the same time last year. By comparison, it sold 626,000 gas powered cars in the same period.Which brings us to today’s give-fest, in which the ever-obliging Canadian taxpayer delivered another $5 billion to Honda.Yes, $5 billion.5) Honda gets $5 billion taxpayer subsidy to build multiple Ontario EV plantsDesperate apologists will say, of course, that ‘no, no it’s not a grant, it’s a tax break.’ Well, have it your own way. But in the CRA, they have a word for that — “tax expenditure.” The bureaucracy thinks all the money is theirs, you see, so if you’re a crusading politician who cuts taxes, you’re actually committing a tax expenditure.And now as both Ottawa and Queen’s Park have decided to commit tax expenditure by forgiving Honda $5 billion, their revenue departments will just go find it somewhere else. (Dear heavens, did you think that prime minister and premier alike would each give directions to cut expenditures elsewhere to pay for the Honda inducement?)But there it is, the story told in headlines. As drivers around the world say, “darned if I want one of those,” and motor manufacturers get out of the game until the Government of Canada gives them taxpayer dollars to build them.Because, to today's $5 billion ‘tax expenditure’ on the Honda Alliston plant, you can add the estimated $14.4 billion that Volkswagen got in St. Thomas (ON) the (as much as) $16.3 billion received by Stellantis, the $4.2 billion awarded to Swedish battery maker Northvolt, and the $1.28 billion given to Ford in Quebec.That’s more than $40 billion. Pretty soon we’ll be talking about real money.The real money will come, of course. That will be when — or if — we see any substantive announcements about increased power generation to run this new fleet of vehicles, or for improvements to the grid to get that power to where it’s needed. To build the capacity that would just simply replace our present gasoline-powered driving with electric-powered driving, will be in the trillions, not the billions.We are talking about a country with a government that wants to bring in half a million new citizens a year, however. And that should make you wonder whether it is even the intention of the Trudeau Liberals to make that possible.A lot of us will be walking. And perhaps that was the plan, all along.

HANNAFORD: How Ottawa pays corporations $40 billion to make cars nobody wants

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