Those native to Ontario likely grew up knowing at least one person, be it a neighbour, a friend, or even a family member, who worked in the Canadian automobile manufacturing industry. Auto manufacturing was once the heart of the province’s economy, and it remains the single largest manufacturing industry there, employing 4.9% of Ontario’s workforce.

Over half a million people work in the automobile manufacturing industry, which includes the manufacture of parts, components, and systems for cars, vans, trucks, buses, and military vehicles. Canada is the eighth largest vehicle manufacturer in the world. From 2012 to 2016, Canada produced an average 2.4 million vehicles each year.

Ontario is home to the Canadian headquarters of all Big Three American automakers: Ford, Chrysler, and General Motors. Most of Canada’s output consists of light duty trucks and SUVs, like the Toyota RAV4, the Ford Edge, and the Lexus RX350. Perhaps it is not surprising that this style of vehicle is also the most popular among Canadian consumers.

History of Automobile Manufacturing in Canada

Large-scale automobile production in Canada began back in 1904 in Walkerville, Ontario, near Windsor. There, the Ford Motor Company of Canada manufactured its Model C car.

It was around the same time that the city of Detroit, Michigan, just across the river from Windsor, became the auto manufacturing capital of the world. Windsor became the Canadian extension of that epicentre. The Detroit connection would remain a critical piece of the Canadian automobile industry.

By the end of the 1920s, Canada’s automotive industry was the second largest in the world. However, exports to the United States fell in the Great Depression, marking the first of many hurdles the auto manufacturing industry would face as time went on.

Automobile manufacturing received the same post-war boost as the rest of the Canadian economy but faced challenges in the 1970s and 1980s. When the price of oil increased, the demand for trucks and SUVs declined. This gave Japanese companies an opportunity to move into the domestic market by offering smaller vehicles. The industry faced further pressure in the late 20th century, as globalization sent some manufacturers to markets with less expensive labour.

Today, the automobile manufacturing industry is on the upswing. The industry makes up 16.5% Canadian exports. American and Japanese automakers are attracted to Canada’s strong infrastructure, highly educated workforce, and relatively low labour costs.

Economic recoveries in Alberta and Saskatchewan from the impact of high oil prices, along with lower-than-ever interest rates on vehicle loans, have also spurred unprecedented automobile sales in Canada. Automotive parts manufacturing is currently one of the nation’s fastest-growing manufacturing sectors.