Canadian Automobile Industry and Government Agree on Climate Change Action

April 5th, 2005

A landmark agreement on climate change action was signed by the Government of Canada and the Canadian automobile industry today. Under the Memorandum of Understanding (MOU), automobile manufacturers voluntarily agree to reduce greenhouse gas (GHG) emissions from new vehicles in Canada so that by 2010, annual emissions reductions will reach 5.3 megatonnes. The MOU signing took place at Auto 21, an automotive engineering facility at the University of Windsor.

The MOU was signed by the Honourable R. John Efford, Minister of Natural Resources Canada; Joe Hinrichs, Chair of the Canadian Vehicle Manufacturers' Association (President and CEO, Ford of Canada); Marcus Breitschwerdt, Chair of the Association of International Automobile Manufacturers of Canada (President and CEO, Mercedes-Benz Canada). All major companies of Canada's automobile industry are part of the MOU.

"This is a good deal for the economy, the environment and consumers. Ultimately, it's a deal that all Canadians will benefit from as the new technologies needed to reach this target come on the market," said Minister Efford. "I'm particularly proud that we've reached this historic agreement voluntarily, which clearly shows the automobile industry is prepared to do its part to address climate change. I congratulate everyone who helped make this day possible."

"Canada's automobile industry has a long history of introducing new technologies that make the vehicles we produce more environmentally friendly and safer," said Mr. Hinrichs. "As we look to the future, we remain committed to doing our fair share to reduce GHG emissions while contributing to economic growth."

"We're very proud that we were able to forge a strong voluntary agreement," said Mr. Breitschwerdt. "Our success with the voluntary approach in Canada is well known, and this agreement will be a valuable tool for this industry and government to continue to work toward achieving our common goals."

The Government of Canada and the automobile industry worked together to achieve a voluntary agreement that gives consumers fuel-saving choices, focuses on immediate action to achieve GHG reductions and provides a cost-effective solution for government, industry and consumers.

To achieve the Government's GHG-reduction objective for the sector, the Canadian automobile industry will offer and promote a wide variety of fuel-saving vehicle technologies, including hybrid powertrains, cylinder deactivation technology, advanced diesel technology, and emerging technologies. The industry will continue to pursue design and engineering improvements without compromising vehicle-occupant safety, while also bringing forward technologies that promote more fuel-efficient driving behaviour.

In support of the Government's climate change objective, the industry will continue to help Canadians understand what they can do to reduce GHG emissions, and will support positive consumer and driver behaviour with respect to the purchase, maintenance and operation of cars and light-duty trucks across Canada. The industry will continue work with the Government and fuel providers to ensure that appropriate fuels, including alternate fuels, are available.

"More and more, we see environmental sustainability as one of the fundamentals of economic competitiveness," said the Honourable Stéphane Dion, Minister of the Environment. "This agreement represents a strong commitment on the part of the auto industry to work with the Government of Canada and all Canadians in the pursuit of economic and environmental prosperity."

"As an Ontarian and a Canadian, I know how much both the province and the country gain from the auto industry," said the Honourable Joe Volpe, Minister of Citizenship and Immigration and regional minister for Ontario. "This is an agreement that will allow our children to continue to enjoy the economic benefits of a strong auto industry and a healthier environment thanks to its culture of innovation."

"A great many people in my riding of Whitby-Oshawa rely on the auto industry for their livelihoods," said the Honourable Judi Longfield, Parliamentary Secretary to the Minister of Labour and Housing. "They take great pride in the contribution their industry makes to our economy. Today, they can be equally proud of their contribution to protecting our environment."

"A strong auto industry is a key part of Canada's and Ontario's economy," said the Honourable David L. Emerson, Minister of Industry. "As they continue to grow, this industry and others will continue to develop the new technologies and processes that are needed to provide high-skill, high-paying jobs for Canadians and Ontarians and improve our environment."

A key component of this agreement is the joint government-industry monitoring of annual industry performance against projected interim GHG reduction goals to ensure progress.

The automobile industry has a strong track record of achievement with voluntary agreements. Since 1977, it has agreed to and successfully implemented more than a dozen agreements. These range from vehicle-safety advancements such as vehicle side-impact protection and air bags to energy improvements and emissions-reduction issues.