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Since many automobile manufacturers in North America enhance the yield in 2010, the Canadian auto parts supplier shipments to grow 20%. However, the local auto parts suppliers in Canada’s competitiveness weakened due to a stronger Canadian dollar. Canadian dollar against the U.S. dollar has risen in 2005, about 100:82.5 100:98.01.

Bank of Nova Scotia on March 30 released a report, due to the appreciating Canadian dollar and competition from low-cost countries, the Canadian auto parts industry exports less competitive and thus more focus on Canada’s domestic market. However, in their home markets, they also encountered from Mexico, China and other low cost countries, parts of the competition. External and internal circumstances, the Canadian auto parts industry must increase R & D and maintain technology leadership, and to increase investment in emerging markets. The following are the main contents of the report.

The U.S. market accounted for the Canadian auto parts exports to 92% of total exports, but the exports in 2009 decreased by 32% to less than 90 billion dollars. The amount of auto parts only account for the total U.S. market last year, 6.7%, which is the self of the last century’s worst performance since the 90s. The Mexican auto parts market share in the U.S. last year reached 12%. Canadian auto parts to the exports of other countries outside the United States last year, saw a marginal drop of 40%.

More serious problem is that Canada’s auto parts exports to the United States has more than 60% are exported to the provinces in the Great Lakes region – mainly the traditional automotive powerhouse Michigan and Ohio. These two provinces accounted for the Canadian auto parts exports to the U.S. nearly 50%, but in the U.S. auto industry has dropped the weight. The late ’90s, the United States for more than 40% of all automobile production in the two provinces in 2009, only 33%.

2009, the United States, nearly 40% of all vehicles in the southern province of production, but the Canadian auto parts companies have not been well into the southern United States market, parts and components exports to the U.S. only about 18% are exported to the southern provinces.

Overall, Canadian production of auto parts in the supply of nearly 80% of Canada and the Great Lakes area, but the production of cars in these areas accounts for only 5% of the global total. Asia now accounts for more than half of global auto production, but only 1% of Canadian auto parts company is exporting to Asia.

Outsiders on the national market, “seize”

Decline in exports, while Canadian auto parts companies to put more attention to the domestic market. Can be seen from Figure 1, with the Canadian dollar, Canadian auto parts in the proportion of their sales are also increasing.

In 2009, the Canadian-made auto parts in the supply of more than 45% of all home market, this proportion than in the past 10 years, the average increase of nearly 10%. Produced in Canada each vehicle (including cars and trucks), including about 5,260 U.S. dollars worth of Canadian parts production than a decade ago a significant growth in 3520 U.S. dollars.

At the same time, lower-cost countries from automotive components are also “squeeze” the Canadian market share. Canadian vehicle production in 2009, from Mexico to 1650 U.S. dollars worth of spare parts, 800 U.S. dollars more than doubled in 2003; value of spare parts from China, more than 600 U.S. dollars, while 5 years ago only 320 dollars parts from China.

China’s auto parts exports to Canada, about one-third of the braking system and electronic system components.

Canadian auto parts industry, the way out

Canadian auto parts industry for these problems, the report of the recommendations given CarlosGomes is: “To realize the Canadian auto parts industry, long-term development, we must increase the strength and innovation in the rapidly growing emerging markets investment, while In the North American market ‘resist’ low-cost countries from Latin America and Asia competition.

Although the Canadian auto parts industry in many areas are world leader in cutting-edge technology, but its R & D investment in automotive components is still much lower than U.S. firms. Canadian auto parts company’s R & D investment accounted for its share of sales of about 3% lower than the U.S. companies nearly 1%. Last year, even worse, only about 1.8% of sales for R & D investment. Canadian auto parts enterprises to increase investment in technology research and development to ensure its new products, including leading the field of green technology. ”

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