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Automotive

Mexico pushing labour reform, won’t ratify new NAFTA with U.S. tariffs in place

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OTTAWA — Mexico’s Congress will be asked to approve a major labour-reform bill this spring as a necessary step to ratifying the new North American free-trade pact later this autumn, say Mexican officials.

But unless the Trump administration lifts the punishing tariffs it has imposed on Mexican steel and aluminum imports — duties it also imposed on Canada — Mexico is prepared to keep the status quo with the 25-year-old North American Free Trade Agreement.  

The push to improve workers’ rights in Mexico was a key priority for Canada and the United States during the rocky NAFTA renegotiation because they wanted to level the playing field between their workers and lower-paid Mexican workers, especially in the auto sector.

When Mexico and the U.S. reached their surprise bilateral agreement last August, forcing the Trudeau government to quickly forge a deal with the Trump administration, Foreign Affairs Minister Chrystia Freeland lauded Mexico for making labour concessions.

But a senior trade official in the new government of socialist reformer Andres Manuel Lopez Obrador suggested in an interview it wasn’t a huge sacrifice because elevating the status of country’s workers was a key plank in the platform that brought their Morena party to power.

Lopez Obrador made it clear in his election campaign that he wanted to strengthen the rights of workers and labour unions, which made a good fit with Canada’s bargaining position, Luz Maria de la Mora, Mexico’s deputy trade minister, said in an interview.

“With the agreement or without the agreement, this is something central to President Lopez Obrador — strengthening workers’ rights and strengthening trade deals in Mexico,” said de la Mora.

She said the new government wants a package of labour reform ratified in Mexico’s Congress before its April 30 adjournment “so we can reflect the commitments that we’ve made under the new U.S.-Mexico-Canada agreement in domestic legislation.”

That means the new agreement will be sent to the Mexican Congress for ratification after reconvenes in Sept. 1, she said.

But that won’t happen unless the United States lifts its so-called section 232 tariffs on steel and aluminum exports, said de la Mora.

U.S. President Donald Trump imposed tariffs of 25 per cent on steel and 10 per cent on aluminum from Mexico and Canada, using the controversial national-security clause in U.S. trade law — “Section 232,” as it’s called in shorthand — that both countries say was illegal.

Canadian Transport Minister Marc Garneau recently told Trump’s top economic adviser, Larry Kudlow, during a public panel in Washington that the tariffs are “a serious impediment to us moving forward on what is the best trade deal in the world.”

On Nov. 30, Prime Minister Justin Trudeau, Trump and former Mexican president Enrique Pena Nieto, who was on his last day in office, signed the new trade agreement. It now faces ratification by the legislatures of all three countries.

Trudeau spoke to Trump on Thursday and “raised the issue of steel and aluminum tariffs and expressed the need for the removal of tariffs,” the Prime Minister’s Office said.

If the tariffs aren’t lifted, de la Mora suggested Mexico is fine with the current version of NAFTA that remains in force.

“We hope to have this new agreement in place. But in the absence of the new agreement, we know that NAFTA is good enough,” she said.

Mexico would prefer the updated agreement “for the relations we have with the U.S. and Canada but we are OK with the current NAFTA.”

Mexican senators, who were in Ottawa the past week to conference with their Canadian parliamentary counterparts, echoed de la Mora’s assessment.

“We are going to approve it, but right now our government is trying to deal with this (the tariffs),” Sen. Antares Guadalupe said in an interview.

“We’re not in a rush. Trade right now, it’s working,” she added. “We have many things to do but we want to take it slowly because it is very important to have it in a very good way for Mexico.”

Sen. Hector Vasconcelos, the head of the Mexican Senate’s foreign-affairs committee, said the ratification of the new agreement is also subject to the domestic political situations in all three countries. That includes the ongoing turmoil in the Trump administration and Canada’s legislative clock, which will see the House of Commons adjourn in June until after the October federal election.

Asked what happens if the new agreement is not ratified, Vasconcelos laughed.

“Life goes on, I assure you,” he said, referring to the current NAFTA. “It’s good enough and we will try to get it better. That’s what we are going to do. We have to discuss a lot in Mexico.”

Mike Blanchfield, The Canadian Press




Automotive

Electric car sales climb in wake of new $5,000 federal rebate program

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electric car

OTTAWA — Transport Canada data shows more than 14,000 electric vehicles were purchased nationwide during the first three months of the federal government’s new rebate program.

On May 1, Ottawa began offering rebates of up to $5,000 on the purchase of some electric vehicles.

The rebate is intended to bring the price of zero-emission vehicles closer to their gas-powered cousins.

Dan Woynillowicz, policy director at Clean Energy Canada, says the rebate is the only thing he can point to as a reason why electric car sales jumped 30 per cent since January.

The increase happened despite a drastic drop in electric car purchases in Ontario in the first three months of the year after the province cancelled its rebate in 2018.

The federal government wants 10 per cent of all cars sold to be zero-emission by 2025, 30 per cent by 2030 and 100 per cent of sales by 2040.

The Canadian Press

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Automotive

From Nazis to hippies: End of the road for Volkswagen Beetle

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FRANKFURT — Volkswagen is halting production of the last version of its Beetle model this week at its plant in Puebla, Mexico. It’s the end of the road for a vehicle that has symbolized many things over a history spanning eight decades since 1938.

It has been: a part of Germany’s darkest hours as a never-realized Nazi prestige project. A symbol of Germany’s postwar economic renaissance and rising middle-class prosperity. An example of globalization, sold and recognized all over the world. An emblem of the 1960s counterculture in the United States. Above all, the car remains a landmark in design, as recognizable as the Coca-Cola bottle.

The car’s original design — a rounded silhouette with seating for four or five, nearly vertical windshield and the air-cooled engine in the rear — can be traced back to Austrian engineer Ferdinand Porsche, who was hired to fulfil Adolf Hitler’s project for a “people’s car” that would spread auto ownership the way the Ford Model T had in the U.S.

Aspects of the car bore similarities to the Tatra T97, made in Czechoslovakia in 1937, and to sketches by Hungarian engineer Bela Barenyi published in 1934. Mass production of what was called the KdF-Wagen, based on the acronym of the Nazi labour organization under whose auspices it was to be sold, was cancelled due to World War II. Instead, the massive new plant in what was then countryside east of Hanover turned out military vehicles, using forced labourers from all over Europe under miserable conditions.

Re-launched as a civilian carmaker under supervision of the British occupation authorities, the Volkswagen factory was transferred in 1949 to the Germany government and the state of Lower Saxony, which still owns part of the company. By 1955, the millionth Beetle — officially called the Type 1 — had rolled off the assembly line in what was now the town of Wolfsburg.

The United States became Volkswagen’s most important foreign market, peaking at 563,522 cars in 1968, or 40% of production. Unconventional, sometimes humorous advertising from agency Doyle Dane Bernbach urged car buyers to “Think small.”

“Unlike in West Germany, where its low price, quality and durability stood for a new postwar normality, in the United States the Beetle’s characteristics lent it a profoundly unconventional air in a car culture dominated by size and showmanship,” wrote Bernhard Rieger in his 2013 history, “The People’s Car.”

Production at Wolfsburg ended in 1978 as newer front drive models like the Golf took over. But the Beetle wasn’t dead yet. Production went on in Mexico from 1967 until 2003 — longer than the car had been made in Germany. Nicknamed the “vochito,” the car made itself at home as a rugged, Mexican-made “carro del pueblo.”

The New Beetle — a completely retro version build on a modified Golf platform — resurrected some of the old Beetle’s cute, unconventional aura in 1998 under CEO Ferdinand Piech, Ferdinand Porsche’s grandson. In 2012, the Beetle’s design was made a bit sleeker.

The end of the Beetle comes at a turning point for Volkswagen as it rebounds from a scandal over cars rigged to cheat on diesel emissions tests. The company is gearing up for mass production of the battery-driven compact ID.3, a car that the company predicts will have an impact like that of the Beetle and the Golf by bringing electric mobility to a mass market.

The last of 5,961 Final Edition versions of the Beetle is headed for a museum after ceremonies in Puebla on July 10 to mark the end of production.

___

AP photo blog about the last Volkswagen Beetle: https://bit.ly/32bXuMx

David McHugh, The Associated Press






















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