AUTOMOTIVE. AN ECONOMIC ENGINE.
Canada has one of the lowest business costs in the G7 with a 5.1 percentage point cost advantage over the U.S. – making a huge difference to your bottom line. These are findings from the Competitive Alternatives: KPMG’s Guide to International Business Costs, 2006 edition which provides a comprehensive analysis of automotive production costs in nine countries and 128 cities in North America, Europe and Asia-Pacific. Home to six major international auto manufacturers, Canada’s auto sector accounts for 12.3 percent of the country’s manufacturing GDP, and Canadian-based companies export about 76 percent of their production primarily to the U.S.
KPMG’s automotive model looked at subcontracted Tier 2/3 auto parts manufacturers typically engaged in the production of metal, plastics and electronic components.
THE BOTTOM LINE:
- Canada ranks second in the G7 as a low-cost investment location for the automotive sector.
- Canada’s automotive sector also benefits from the country’s No. 1 G7 rank in precision manufacturing and electronic sectors.
- Canada offers the lowest labour and benefit costs in the G7, with a nearly 12 percent advantage over the U.S.
- Canada offers the lowest interest and depreciation costs in the G7.
- Three Canadian cities rank among the top 10 most cost-competitive G7 locations with Sherbrooke No. 1.
LOW-COST HOT SPOTS
- Sherbrooke
- Moncton
- Charlottetown
- Quebec City
- Montreal