A worker leaves the Ford assembly plant in Oakville, Ont., on July 18.Sammy Kogan/The Globe and Mail
Gus Carlson is a U.S.-based columnist for The Globe and Mail.
Ford Motor Co.’s F-N decision to produce gas-powered trucks at its Oakville, Ont., assembly plant and push off its electric-vehicle plans is yet another reminder that free-market realities rooted in customer demand win over ideology and government mandates every time.
Ford’s move, announced last week, reflects continued hesitance among car buyers about a wholesale shift to an all-electric future that has slowed EV sales globally and put automakers’ investments in the emerging technology at risk. Ford, for example, has said it lost US$4.7-billion on EVs in 2023, and expects to lose US$5.5-billion this year.
Moreover, Ford’s decision reflects consumers’ mounting resistance to government efforts in the United States and Canada to press them into buying things they simply don’t want. Whether it’s EV sticker prices, range anxiety, the cost of maintenance, repairs and insurance, or resale concerns, car buyers are voting with their wallets with such fervour that mandates for all new-car sales to be EVs by 2035 look less and less likely to hold.
But Ford’s decision is much more than a refresher course in market dynamics. It is a good thing for Canada, for Ontario, for workers and their communities, and for the economy.
Ford said it will inject US$2.3-billion into the plant to produce heavy duty trucks in its F-series line, the bestselling truck models in North America, beginning in 2026. Production of those trucks is maxed out at Ford plants, the company said, so converting the Oakville plant makes sound operational sense.
The investment marks a significant increase from Ford’s original investment plans of US$1.8-billion earmarked for EV production in Oakville, which were put on hold earlier this year as cracks continued to appear in the EV market.
The pivot will create 1,800 jobs. These are good jobs, with good pay, good benefits and will go a long way to supporting thousands of families in the communities that serve the Oakville plant’s work force and the supply chain that supports it. Even the autoworkers’ union, Unifor, is excited about the prospect.
Ontario, too, has acknowledged this is a good thing, even though the province and Ottawa pledged $590-million to support the Oakville plant’s EV conversion in 2020. It remains to be seen how that investment is sorted, but it’s clear that no one wants to put money on a flagging horse.
The timing could not be better. In a tough economy with stubborn inflation, high interest rates and nagging labour shortages, Ford’s move is a windfall for the market. It will create jobs and investment downstream in the supply chain serving the plant. It also allays fears that the jobs tied to Ford’s EV plans for Oakville would be lost forever when the company put those plans on hold.
Things could have gone a much different – and negative – way. Just ask the 1,400 workers in Michigan who were reassigned or offered early retirement packages when Ford stopped production of its all-electric Lightning pickup trucks this year because of weak demand.
Beyond the numbers, the move should be a source of pride for Canadian workers. It shows once again that they are world class examples of Canadian excellence and, yes, exceptionalism.
Ford could have chosen anywhere in its network to build its F-series trucks but it picked Oakville because of the plant’s track record of performing at six sigma levels. The choice suggests Oakville is not simply relevant to Ford’s plans, it is critical. And, for the record, the company said it anticipates making Super Duty EV trucks in Oakville by the end of the decade.
While the EV faithful will see this as a step backward on their ideological quest, they need to remember this: It’s not Ford’s job to push their agenda, especially one that is running counter to customer preferences and putting jobs, investments and the communities that rely on a healthy economy at risk.
In the case of EVs, it is the car-buying public, not the automakers, who are making the purchase decisions, and by extension, telling mandate-happy governments that for the most part this is still a free country, and they don’t like having regulations jammed down their throats.
Ford should be congratulated, not vilified, for making a tough decision in the name of serving its customers – a decision that will inject so much prosperity into the economy.
Like so many automakers, Ford is learning that sometimes it’s hard to be the grown-up in the room who makes decisions based on real-world considerations the ideologues don’t always want to acknowledge.