Canada’s automobile parts plants can compete against any of its counterparts around the world, including lower-cost rivals, the chief executive of Linamar (LNR.TO) said in an interview with BNN.
Linda Hasenfratz said she's not worried that the industry will be overtaken by cheaper auto parts manufacturers in countries such as Mexico, after Linamar reported record results on Wednesday. The Guelph, Ont.-based company reported a 21 per cent jump in sales in the second quarter, compared with the same period last year.
Hasenfratz said the work by her Canadian plants can “absolutely” compete against the rest of the world, especially by using technology to offset the country’s higher labour costs.
“Our Canadian plants are the most productive globally,” Hasenfratz said. “They do the best job of improving productivity, the best job around purchasing, are really engaged in terms of lean and continuous improvement and we’re happy to put them up against anybody around the world.
“You stay competitive [and] control costs, through innovation.”
Hasenfratz’s comments come as Unifor, Canada’s largest private-sector union, hold contract negotiations with GM, Fiat Chrysler and Ford that are expected to shape the future of Canada’s auto industry. The union representing most Canadian autoworkers said on Wednesday that it is seeking higher pay for its members.
Still, Hasenfratz says Linamar its labour costs are a “smaller part” of its overall cost structure.
“That increased productivity and efficiency that we have in our Canadian plants goes a long way to offset that cost differential that we have compared to a lower-cost country,” she said.