THE AUTOMOTIVE AND CONSTRUCTION EQUIPMENT INDUSTRY CANADA Fact Pack

1. THE AUTOMOTIVE AND CONSTRUCTION EQUIPMENT INDUSTRYCANADA Fact Pack

3. THE AUTOMOTIVE INDUSTRY ACCOUNTS FOR 18.6% OF TOTAL MANUFACTURING SHIPMENTS IN CANADA Total shipments of the Canadian manufacturing industry are more than SEK 4,015 billion (2005) The average wage for a manufacturing industry worker in Canada is SEK 135.34/hour (2005) There are approximately 97,860 companies* within the manufacturing industry in Canada (2005) 40,000 firms are directly tied to the automotive industry (manufacturing, sales, distribution, repair) Manufacturing employs 1.9 million workers (2003) Automotive manufacturing – assembly and parts – directly employs 231,800 thousand workers (2005)

4. Overview Canadian Manufacturing Industry Canadian Automotive Industry Passenger cars Commercial vehicles Suppliers Canadian Construction Equipment Industry Recommendations References Appendices CONTENT

5. THE CANADIAN PRODUCTION OF LIGHT AND HEAVY VEHICLES TOTALS SEK 458 BILLION

6. 2.7 MILLION VEHICLES WERE PRODUCED IN CANADA IN 2005

7. Overview Canadian Manufacturing Industry Canadian Automotive Industry Passenger cars Commercial vehicles Suppliers Canadian Construction Equipment Industry Recommendations References Appendices CONTENT

8. TOTAL PASSENGER CAR PRODUCTION IN CANADA IS STABLE- Decline of North American Big Three against the rise of foreign OEM’s Market share loss of North American Big Three (GM, Ford, Daimler-Chrysler) matched by gain of foreign OEMs Foreign OEMs (Toyota, Honda) surpassed the Big Three sales of light vehicles (cars and light trucks) in Canada in 2003 Big Three are undertaking major restructuring to combat shrinking market share Government stepping up automotive investment promotion, especially to Japan and Europe SEK 6 billion in federal and provincial government aid from 2004-2006 Capital investments in Ontario at an all-time high Recently announced expansions by major auto makers and parts suppliers (see Appendix 3)

10. ONTARIO IS CANADA’S AUTOMOTIVE POWERHOUSE AND HOME TO ALL LIGHT VEHICLE ASSEMBLY PLANTS

11. SOUTHWESTERN ONTARIO LIGHT VEHICLE* ASSEMBLY PLANTS

13. Overview Canadian Manufacturing Industry Canadian Automotive Industry Passenger cars Commercial vehicles Suppliers Canadian Construction Equipment Industry Recommendations References Appendices CONTENT

14. GROWING DEMAND HAS RESULTED IN STEADY CLIMB OF HEAVY TRUCK PRODUCTION High levels of freight movement and a strong economy are driving increased demand In terms of value, 60% of Canada/U.S. trade is moved by truck (2005) Over 37,000 trucks cross the Canada/U.S. border each day Hino Motors Canada recently became the first Japanese truck maker to locate an assembly plant in Canada (June 2006) Canadian and U.S. governments passed regulations in 2002 to virtually eliminate heavy truck emissions of particulate matter by 2007, and nitrous oxides by 2010

17. MOST HEAVY TRUCK MANUFACTURERS ARE LOCATED IN SOUTHWESTERN ONTARIO AND QUEBEC

18. BUS MANUFACTURING IS FRAGMENTED INTO SCHOOL BUSES, URBAN TRANSIT BUSES AND COACH BUSES

20. Overview Canadian Manufacturing Industry Canadian Automotive Industry Passenger cars Commercial vehicles Suppliers Canadian Construction Equipment Industry Recommendations References Appendices CONTENT

21. THERE ARE OVER 900 AUTOMOTIVE SUPPLIERS IN CANADA- Magna International is the world’s 9th largest auto parts supplier There are 900+ auto parts suppliers in Canada (T1 and T2) Ontario-based Magna International is one of the top 10 largest automotive suppliers in the world There is a very high concentration of automotive suppliers in Southwestern Ontario Many of the companies have less than 500 employees, including subsidiaries of foreign-based companies Canada is a world leader in: Injection and blow molding Hydroforming Ferrous and non-ferrous casting Powder metal coating and facbrication Systems and component integration Stamping

22. MAGNA INTERNATIONAL IS CANADA’S LARGEST AUTO PARTS SUPPLIER

25. T1 SUPPLIERS ARE STRATEGICALLY LOCATED TO PROVIDE JUST-IN-TIME DELIVERY TO MAJOR ASSEMBLERS IN CANADA & THE U.S.

26. SOME OF THE LARGER T2 SUPPLIERS ARE FOREIGN-OWNED SUBSIDIARIES IN CANADA

29. Overview Canadian Manufacturing Industry Canadian Automotive Industry Canadian Construction Equipment Industry Manufacturers Suppliers Recommendations References Appendices CONTENT

30. CANADIAN CONSTRUCTION EQUIPMENT PRODUCTION TOTALED SEK 11.6 BILLION IN 2003

31. HEAVY CONSTRUCTION EQUIPMENT IS MAINLY IMPORTED* – DOMESTIC MANUFACTURING IS LIMITED TO SMALLER FIRMS**

32. MOST CONSTRUCTION EQUIPMENT PLANTS PRODUCE RELATIVELY LOW VOLUMES & MAKE PURCHASE DECISIONS LOCALLY

33. MANY OF THE LARGER MANUFACTURERS OF CONSTRUCTION EQUIPMENT IN CANADA ARE LOCATED IN SOUTHERN ONTARIO

34. Overview Canadian Manufacturing Industry Canadian Automotive industry Canadian Construction Equipment Industry Manufacturers Suppliers Recommendations References Appendices CONTENT

35. CONSTRUCTION EQUIPMENT MANUFACTURERS IN CANADA RELY ON IMPORTS AND/OR SMALL, LOCALLY-BASED SUPPLIERS

37. SUPPLIERS OF CONSTRUCTION EQUIPMENT ARE WIDELY DISPERSED IN CANADA

39. Overview Canadian Manufacturing Industry Canadian Automotive industry Canadian Construction Equipment Industry Recommendations References Appendices CONTENT

41. Overview Canadian Manufacturing Industry Canadian Automotive Industry Canadian Construction Equipment Industry Recommendations References Appendices CONTENT

42. HOW CAN STC IN CANADA SUPPORT COMPANIES TO DO BUSINESS IN CANADA

43. CANADA IS AN ATTRACTIVE MARKET AND STC HAS HELPED MANY SWEDISH COMPANIES TO ENTER OR ESTABLISH

44. Overview Canadian Manufacturing Industry Canadian Automotive Industry Canadian Construction Equipment Industry Recommendations References Appendices CONTENT

45. APPENDIX 1: DEFINITIONS Shipments (value of) Summation of value of shipments produced by establishment, receipts of custom and repair revenue. Light truck Vehicle weighing less than 14,000 lbs (or 6.35 tons) Medium-duty truck Vehicle weighing from 14,001 to 26,000 lbs (or 6.35 to 11.79 tons) Heavy-duty truck Vehicle weighing from 26,001 to 33,001 lbs (or 11.79 to 14.97 tons). Also included off-highway trucks. Truck class: In Canada, truck manufacturers also use a class system to designate trucks of various gross vehicle weight ratings: Class 1 and 2 vehicles: Less than 10,000 lbs. (or 4.54 tons) Class 3, 4, and 5 vehicles: 10,001 to 19,500 lbs. (or 4.54 to 8.85 tons) Class 6 vehicles: 19,501 to 26,000 lbs. (or 8.85 to 11.79 tons) Class 7 vehicles: 26,001 to 33,000 lbs. (or 11.79 tons to 14.97 tons) Class 8 vehicles are 33,001 lbs. (or 14.97 tons) or more.

46. APPENDIX 1: DEFINITIONS (continued) Tier 1 Supplier Manufacturer to the vehicle assemblers who are responsible for delivery of the finished assembly, product development and continued technology renewal. Tier 2 Supplier Producer of parts providing value-added to minor sub-assembly. Tier 3 Supplier Supplier of engineered materials and special services, such as rolls of sheet steel, bars and heat treating, surface treatments.

48. APPENDIX 3: NEW INVESTMENTS IN CANADA’S AUTOMOTIVE ASSEMBLY SECTOR Recent string of major investments contributes to favourable outlook of Canada’s automotive sector Over SEK 46 billion in new auto investments in Ontario announced since 2004 Canada is consistently receiving 20% of new North American assembly investments Government is highly proactive in investment promotion to automotive manufacturers, with SEK 6.6 billion in government aid since 2004

49. APPENDIX 4: CANADA’S BUSINESS ENVIRONMENT Canada ranks second in the G7 as a low-cost investment location for the automotive sector. Compared to the U.S., lower construction costs (-8%), lower office lease costs (-15%), lower transportation costs (-28%), and lower energy costs. Canada has an attractive business environment for foreign investment Budget surplus and low inflation Lowest interest and depreciation costs in the G7 Canada offers the lowest labour and benefit costs in the G7, with a nearly 12% advantage over the U.S. Wages generally lower than most U.S. states Canada is well-integrated into the U.S. transportation system

51. APPENDIX 5 (2/2): MAKERS OF CONSTRUCTION EQUIPMENT ATTACHMENTS ARE LOCATED THROUGHOUT CANADA