How U.S. Companies are Innovating to Stay Competitive
Let us begin with the critical setting of the Inflation Reduction Act in the United States. The IRA includes up to $370 billion in new spending and tax credits to promote clean energy and accelerate the aim of decarbonization. The size of these public funds is difficult to overstate: it exceeds Ottawa's total annual budget. When other U.S. advantages are taken into account, such as lower salaries, right-to-work legislation, and the size of its domestic market, competing for electric car investments will be tough (and extremely expensive) for Canada. It may make for good one-off news conferences, but it is hardly a long-term economic strategy. It's also not clear whether the economic benefits outweigh the costs. Electric vehicle manufacturing differs from typical automobile production. Electric vehicles require less than half the labor to manufacture as traditional internal combustion engine automobiles, require far fewer parts (reducing employment by downstream suppliers such a...