Every November, the OG100 membership and invited guests unite for a day of learning and networking. We explore the issues of the day, reflect on common themes of the year, and project how these developments might impact the new calendar year.
This session was a bit different as we couldn’t gather in person, but we recalculated and explored three hot topics virtually: the future of transportation, Canada’s comparative economic advantage post COVID-19, and global trade insight from the FedEx trade index survey.
Opened with a message from Minister Vic Fedeli
The morning included welcoming remarks by Minister Vic Fedeli, Ontario Ministry of Economic Development, Job Creation and Trade. Minister Fedeli commented on the government’s main learnings from COVID-19, including the importance of growing our domestic supply chain to reduce reliance on other countries for essential supplies. He discussed the Ontario Together fund, a $50 million investment by the Ontario government. The fund has announced 15 projects with many more in the pipeline.
Future of Transportation: Auto panel
We then jumped into a discussion on the future of transportation, with a focus on auto. Flavio Volpe of APMA moderated the session and offered a bit of history on electric vehicles. He pointed out that common opinion considers EVs to be the cutting edge of auto business, but in fact, it’s an old concept, dating back to 1800s: the first battery powered car was made more than 100 years ago.
Flavio also commented on CUSMA, which he thinks does a good job of underpinning the auto industry in Canada and he expects will increase the volume of parts purchased from Canada by 25 per cent.
Frank Voss, President of TMMC, and Asad Husain, partner with McKinsey & Company, completed our morning auto panel. Frank gave us a great overview of Toyota’s work with EV and plans up to 2050. Prior to COVID-19, Toyota was on track to produce 100,000 hybrids across three plants in North America. This is a lot of growth since they first introduced hybrid vehicles to the Canadian market in 2000 and sold 225 hybrids. Though the interest in electrification is growing, there are three main challenges that Toyota continues to face: battery cost, the range of a charge, and the incentives to use electric vehicles. The average Canadian either can’t afford or aren’t willing to pay for it at this point.
The theme of consumer behaviour also came up with Asad as he offered insight on the evolution of mobility in cities. Mobility in cities was severely impacted by the COVID-19 lockdown; driving and walking have bounced back faster than transit. Consumers now rate risk of infection as the primary determinant for choice of mode, even above cost. The three most significant game changers that will impact city mobility in the future (2030+) are:
- Change in vehicle modes and infrastructure. IE: the introduction of autonomous vehicles for people mobility (robotaxis, roboshuttles) and goods mobility (drones, droids, lockers).
- Change in regulatory oversight including increased regulation at the city level (ie: per mile zombie tax).
- Change in consumer behaviour: further acceleration of e-commerce and shift away from private vehicle ownership as the default model in select segments.
cANADA’S COMPARATIVE ECONOMIC ADVANTAGE
After lunch, Heather Scoffield with the Toronto Star interviewed Michael Wernick, Former Clerk of the Privy Council. They explored Canada’s Comparative Economic Advantage in the year(s) ahead. The U.S. election is certainly on everybody’s minds, so the two dissected the Biden win. Michael surmises that a Biden government will not make things easy for Canada: the US government will be hard-headed on 5G, TPP, etc. We can expect issues regarding trade, taxing tech industries and more.
In terms of pandemic spending, Michael said he’s always on the growth side of the growth versus austerity debate, and he is not worried about the spending we’ve done thus far. In fact, his guess is that most other G7 countries would happily trade places with Canada.
Michael expects that the relationship between US and China is the meta framing relationship for the next 50 years. Michael’s advice to business leaders: learn everything you can about China, including history and systems.
Michael provided a lengthy list of competitive advantages Canada will have coming out of COVID. Here are some of the reasons to be optimistic about Canada in a 5 – 10 year outlook:
- The diversity of the Canadian economy: we have it all! natural resources, hydroelectricity, major food exporting opportunities, manufacturing sector, quantum computing, biopharmaceutical, tech, finance, and more.
- Our labour force is relatively young compared to other G7 countries.
- We have strong education in Canada. Michael encourages CEOs to get on the board of a college to have input on their direction in trades.
- We’re good at streamlining decision-making processes in Canada.
- We still have space for public discourse – other countries don’t.
There is one vulnerability Michael cautions against, and that is falling into a sense of complacency. We need to keep moving and striving to reach our full potential.
Global Trade Insights from FedEx’s Trade Index
We closed the day with a keynote by Lisa Lisson, President, FedEx Express Canada. Lisa shared global trade insights from FedEx’s Trade Index. This is the sixth consecutive year for this survey. In September 2020, FedEx surveyed 1,500 decision makers in SMEs throughout Canada, the US and Mexico.
Of these, more than 1/10 businesses are hiring now, and 3/10 expect to be hiring one year from now. Moreover, 86 per cent of SMEs surveyed support CUSMA.
Lisa identified trade barriers that their customers face, which include skills gaps and technology gaps. In every sector, Lisa sees there is a “war on talent” for technology and innovation. It’s difficult to retain this skillset in such a competitive environment, which is one of the many reasons FedEx places such high value on company culture.
Lisa left the audience with a question to help navigate throughout the pandemic, no matter the industry: ask yourself – are we doing enough to stand out in this uncertain landscape?
Thanks to all who joined us for our virtual edition of the Semi-annual Symposium. We are looking forward to seeing you all in person for our Annual Symposium in 2021!