The Canadian Auto Workers union is calling on the federal and provincial governments to work together on new policies it says could help protect and revitalize the country's automotive sector.
In a 50-page report titled "Rethinking Canada's Auto Industry" the CAW on Monday urged governments to make several major changes, including a reworking of trade policies and intervening to curb the lofty loonie.
Canada's auto industry has endured years of turmoil, and corporations have had "complete freedom and power" due to lax government rules, the CAW said.
The union pointed to unbalanced trade policies, which it says have made it a "one-way street" of imports over exports with practically every country except the United States.
It called on Canada to cease free trade negotiations with automaking countries including those in the European Union as well as Japan, Korea, and Thailand.
"Those are all countries which will only sell to us, they will not buy from us in the auto sector," CAW chief economist Jim Stanford said at a press conference unveiling the policy on Monday.
Although Canada has lost five full-time car assembly plants over the last decade, the automotive sector is still a major engine of Canadian economic growth, the union noted Monday.
Some 2,135,121 vehicles are built in Canada — a pace of almost 6,000 a day — and all told, the industry directly employs 112,000 people in Canada and makes up 12 per cent of Canadian exports.
"Germany has not closed an assembly plant since World War II," Stanford noted. "So the idea that you have to accept this wholesale destruction of an industry simply isn't true."
The union argued the loonie should be brought back down to a "fair-value" level. Possible moves could include an intervention from the Bank of Canada or the government preventing foreign takeovers of resource assets, the union said.
"While in theory the global financial system relies primarily on a system of freely floating exchange rates, in practice governments and their central banks regularly intervene in currency markets to influence currency outcomes," the report said.
China has a banking system that is operated by the state, while other countries like Japan, Brazil, Switzerland regularly intervene to manage their exchange rates, it noted.