Ontario is where advanced R&D facilities, world-class academic institutions and leading-edge businesses collaborate to transform ideas into globally traded commercial products. It’s where 700+ parts suppliers and 500+ tool, die and mould makers converge along a 400-kilometre automotive corridor, forming one of the most robust supply chains in the world.

 

Transcript

Five auto assemblers, 700+ parts suppliers and 500+ tool, die and mould makers

The top automakers, 700+ automotive parts manufacturers and 500+ tool, die and mould makers operate here because the infrastructure, skilled trades and more are here.

Who's here?

  • Chrysler, Ford, GM, Honda, and Toyota run 12 plants in Ontario - we're the only province or state in North America with five OEMs.
  • ABC Group, IMS (Intelligent Mechatronic Systems), Magna, Linamar, Martinrea, Multimatic, MIS Electronics, Valiant and The Woodbridge Group are headquartered here.
  • Hitachi Construction Truck Manufacturing builds its multimillion-dollar mining trucks for the North and South American markets here.
  • Hino, a division of Toyota, manufactures trucks in Woodstock, Ontario.

Why are they here?

Because they find everything they need: a high-quality workforce, strategic access to the North American market, a dynamic environment for R&D and a culture of high-quality, award-winning manufacturing.

These advantages are part of the reason we've been one of the leading subnational car producers in North America for the past decade.

Ontario produced 15% of all of North America’s light vehicle production over the past five years. See for yourself how Ontario’s recent production numbers stack up against Michigan, Ohio, Indiana and other jurisdictions.

 

Canada's auto industry is firing on all cylinders.
- The Wall Street Journal

 

Ward's auto production numbers
2012–2014
State 2012 2013 2014 % change versus year ago
Ontario 2,454,064 2,369,961 2,382,218 .5145%
Michigan 2,268,356 2,457,652 2,267,017 -7.75%
Ohio 1,414,434 1,468,567 1,589,052 +8%
Indiana 1,082,095 1,106,447 1,210,825 +9%
Kentucky 1,025,730 1,251,338 1,269,748 +1.4%
Alabama 874,866 918,968 994,982 +8%
Illinois 636,301 744,158 784,723 +5%
Puebla 605,499 516,942 476,451 -8%
Tennessee 573,752 659,338 809,996 +23%
Texas 494,956 507,329 521,092 +3%

Explore Ontario's auto manufacturing hubs and border crossings

 

Ontario's automotive corridor extends from Windsor to Oshawa.

Note our cluster of leading auto assemblers and numerous border crossings.

A highly skilled, productive workforce

Our supply chain has designers, engineers and scientists who have dedicated their lives to perfecting the automobile.

The best workforce for the best quality

What makes the difference? Our workers. With unrivalled industry skills, experience and knowledge, our workers are highly skilled specialists—capable of building to tight tolerances with extreme precision. Ontario also has one of the highest educational attainment rates in the world.


Ontario offers us the best and brightest workers who give their optimum effort every day.
- Linda Hasenfratz, CEO, Linamar Corp.

 

Skilled, available, dedicated and wage competitive

Our 104,000 autoworkers offer:

  • education and skills: 43% of Ontario's auto industry workforce has a post-secondary education
  • dedication: On average, our workers stay with a company for close to nine years; that means reduced training costs for employers
  • value for money: Cadillac, Lexus and Lincoln vehicles are built here. Why? Because building high-quality, prestigious brands require dedication and attention to detail.

 

Trained to the highest standards

  • Ontario is home to nine leading universities with 24+ auto-focused research programs.
  • The Ontario College of Trades, established in 2009, ensures employers have access to workers trained to the highest standards in regulation, safety, education and certification.

 

 

Proximity to market

Choose the best strategic location for your business. Ontario's diversified economy and manufacturing industries are highly integrated with the $20-trillion NAFTA marketplace.

Strategic access to the U.S. market

Ontario offers unparalleled access to the North American market, with 15 road, rail and marine border crossings to the U.S. and five international airports.

  • Every day, over $929 million in trade takes place between Ontario and the U.S.
  • Ontario is next door to the eight U.S. states bordering the Great Lakes: New York, Pennsylvania, Ohio, Michigan, Minnesota, Illinois, Indiana and Ohio.
  • Ontario is closer to the heart of the U.S. auto manufacturing than many parts of the U.S.

 

Southwestern Ontario is closer than you think

Columbus, Dayton and Toronto are almost equidistant from Detroit as are Oshawa, Cincinnati and Indianapolis.


Distance from Detroit, MI to other cities
City Distance (in miles)
Windsor, ON 5
Columbus, OH 206
Dayton, OH 210
Toronto, ON 231
Oshawa, ON 260
Cincinnati, OH 263
Indianapolis, IN 284
Lexington, KY 345
Louisville, KY 360
Knoxville, TN 513
Chattanooga, TN 664
Atlanta, GA 722

R&D in Ontario: driving automotive innovation

Innovate here. We drive advances in all aspects of automotive technology, performance, design, materials and manufacturing processes.

Investing in R&D

Why does so much auto innovation happen in Ontario? Because we're at the forefront of vehicle technology research. We have some of the most sophisticated R&D facilities anywhere.

We are actively investing in our sophisticated R&D infrastructure.

Innovative centres and facilities

Manufacturers doing research in Ontario have access to thousands of world-leading scientists at 24+ auto-focused public research facilities.

  • These facilities have attracted big-name researchers such as Dr. Norm Zhou and Dr. Ali Emadi.
  • Ontario researchers are working on advanced lightweight materials and coatings, manufacturing processes, alternative fuels and powertrain components and systems, among other innovative projects.
  • R&D benefitting both automotive assemblers and parts manufacturers is well supported here. The Natural Sciences and Engineering Research Council of Canada (NSERC) and Automotive Partnership Canada are just two of the organizations funding collaborative R&D activities within our automotive industry.

Facilities include the McMaster Automotive Research Centre (MARC), the Waterloo Centre for Automotive Research (WatCAR), the University of Ontario Institute of Technology's General Motors of Canada Automotive Centre of Excellence, and the Fraunhofer Project Centre at Western.


There's some ridiculously cool things happening in the automotive sector from a technology perspective north of the border. That doesn't happen without having that kind of collaborative look and feel, and that collaborative spirit that is kind of Ontario.
- Justin Moon, Director of Innovation, Lixar

 

Select Ontario automotive research centres

McMaster University
Brockhouse Institute for Materials Research
Canadian Centre for Electron Microscopy
CANMET Materials Technology Laboratory
McMaster Automotive Research Centre
McMaster Manufacturing Research Institute
McMaster Steel Research Centre

McMaster University and University of Waterloo
Initiative for Automotive Manufacturing Innovation (IAMI)

Queen’s University
Advanced Ceramics and Nanomaterials

Queen’s University and Royal Military College
Centre for Advanced Materials and Manufacturing
Fuel Cell Research Centre

University of Ontario Institute of Technology
Automotive Centre of Excellence
Clean Energy Research Laboratory

University of Toronto
Centre for Advanced Coating Technologies

University of Waterloo
Centre for Automotive Research

University of Windsor
Centre for Engineering Innovation
Fluid Dynamics Research Institute
Intelligent Manufacturing Systems

Western University
Fraunhofer Project Centre @ Western
Institute for Chemicals and Fuels from Alternative Resources
Nanofabrication Laboratory

More bang for your R&D budget

  • We make innovation affordable through our R&D tax credit program.
  • This program is available to qualified businesses of any size and applies to a range of eligible costs that is broader than in the U.S. and many other countries. In fact, our R&D tax credits are the most generous of the G7 countries.
  • There is no cap on the program and tax credits can be carried back for three years or forward for 20 years. Combined with federal R&D programs, Ontario's R&D tax credit program can generate 40-60% savings.

Ontario's R&D tax credit program

Select the best description of your operation to see possible after-tax savings you could achieve on your R&D expenditures in Ontario.

Public, private or foreign-owned

  R&D expenditures R&D expenditures at eligible institutitions1
Gross expenditure $100.00 $100.00
Ontario – 20% OBRI2 Tax Credit   -$20.00
Ontario – 4.5% ORDTC3 -$4.50 -$3.60
Federal investment tax credit – 20% -$14.33 -$11.46
Tax deduction4:
(Combined federal of 15% and
provincial of 10% = 25%)
-$20.29 -$16.24
After-tax cost of $100 expenditure $60.88 $48.71

NOTES:
  1. Eligible Ontario research institutes include universities, colleges of applied arts and technology, research hospitals and other entities in Ontario.
  2. The 20% refundable Ontario Business-Research Institute Tax Credit.
  3. The 4.5% Ontario Research and Development Tax Credit.
  4. Tax rates for large manufacturers: Federal 15.0% plus Ontario 10.0% = 25.0%

Public, private or foreign-owned

  R&D expenditures R&D expenditures at eligible institutions2
Gross expenditure $100.00 $100.00
Ontario – 20% OBRI3 Tax Credit   -$20.00
Ontario – 10% OITC4 -$10.00 -$10.00
Ontario – 4.5% ORDTC5 -$4.05 -$3.15
Federal investment tax credit – 15% -$12.89 -$10.03
Tax deduction6:
(Combined federal of 15% and
provincial of 10% = 25%)
-$18.26 -$14.21
After-tax cost of $100 expenditure $54.79 $42.62

NOTES:
  1. Medium-sized companies have taxable income of less than $500,000 and taxable capital of less than $50 million.
  2. Eligible Ontario research institutes include universities, colleges of applied arts and technology, research hospitals and other entities in Ontario.
  3. The 20% refundable Ontario Business-Research Institute Tax Credit.
  4. The 10% refundable Ontario Innovation Tax Credit.
  5. The 4.5% Ontario Research and Development Tax Credit.
  6. Tax rates for manufacturers: Federal 15.0% plus Ontario 10.0% = 25.0%

Public, private or foreign-owned

  R&D expenditures R&D expenditures at eligible institutions1
Gross expenditure $100.00 $100.00
Ontario – 20% OBRI2 Tax Credit   -$20.00
Ontario – 4.5% ORDTC3 -$4.50 -$3.60
Federal investment tax credit – 15% -$14.33 -$11.46
Tax deduction4:
(Combined federal of 15% and
provincial of 11.5% = 26.5%)
-$21.51 -$17.21
After-tax cost of $100 expenditure $59.66 $47.73

NOTES:
  1. Eligible Ontario research institutes include universities, colleges of applied arts and technology, research hospitals and other entities in Ontario.
  2. The 20% refundable Ontario Business-Research Institute Tax Credit.
  3. The 4.5% Ontario Research and Development Tax Credit
  4. Tax rates for large manufacturers: Federal 15.0% plus Ontario 11.5% = Total 26.5%

Public, private or foreign-owned

  R&D expenditures R&D expenditures at eligible institutions2
Gross expenditure $100.00 $100.00
Ontario – 20% OBRI3 Tax Credit   -$20.00
Ontario – 10% OITC4 -$10.00 -$10.00
Ontario – 4.5% ORDTC5 -$4.05 -$3.15
Federal investment tax credit – 15% -$12.89 -$10.03
Tax deduction6:
(Combined federal of 15% and
provincial of 11.5% = 26.5%)
-$19.36 -$15.06
After-tax cost of $100 expenditure $53.70 $41.76

NOTES:
  1. Medium-sized companies have taxable income of less than $500,000 and taxable capital of less than $50 million.
  2. Eligible Ontario research institutes include universities, colleges of applied arts and technology, research hospitals and other entities in Ontario.
  3. The 20% refundable Ontario Business-Research Institute Tax Credit.
  4. The 10% refundable Ontario Innovation Tax Credit.
  5. The 4.5% Ontario Research and Development Tax Credit.
  6. Tax rates for manufacturers: Federal 15.0% plus Ontario 11.5% = Total 26.5%
  R&D expenditures R&D expenditures at eligible institutions2
Gross expenditure $100.00 $100.00
Ontario – 20% OBRI3 Tax Credit   -$10.00
Ontario – 10% OITC4 -$10.00 -$10.00
Ontario – 4.5% ORDTC5 -$4.05 -$3.15
Federal investment tax credit – 35% -$30.08 -$23.40
Tax deduction6:
(Combined federal of 11% and
provincial of 4.5% = 15.5%)
-$8.06 -$6.73
After-tax cost of $100 expenditure $47.21 $36.72

NOTES:
  1. Small CCPCs have taxable income of less than $500,000 and taxable capital of less than $15 million.
  2. Eligible Ontario research institutes include universities, colleges of applied arts and technology, research hospitals and other entities in Ontario.
  3. The 20% refundable Ontario Business-Research Institute Tax Credit.
  4. The 10% refundable Ontario Innovation Tax Credit.
  5. The 4.5% Ontario Research and Development Tax Credit.
  6. Tax rates for small CCPCs on the first $500,000 of taxable income: Federal 11% plus Ontario 4.5% = 15.5%

Table Data Source: Ontario Ministry of Finance, January 2014

* The information provided here presents a potential after-tax cost based on assumptions regarding R&D expenditures, tax incentives and tax rates that may not apply to your business. This information does not constitute tax advice. Please consult your tax advisor to determine the after-tax cost of R&D expenditures for your business.

Download PDF of Ontario's R&D Tax Program (PDF - 1.57 MB) [requires Adobe Acrobat Reader®]


High-quality, award-winning auto manufacturing

Why do corporations with operations around the world continue to manufacture in Ontario when some jurisdictions offer a slew of seductive incentives?

They'll tell you the same thing, time after time: It's the workforce.

Regardless of where companies locate, their sites and manufacturing equipment might be nearly identical. But the workforce makes all the difference.

For parts manufacturers, especially, a quality workforce is critical. Businesses lose clients, opportunities and profits when shipped parts don’t meet customer specifications. A high-quality workforce spots problems and corrects them. Members of a high-quality workforce understand that quality is a process that runs from the start of a job all the way through delivery.

 

Assemblers who win J.D. Power and Associates awards rely on extensive supplier networks. In the end it’s the plant or the model that wins the award. But all parts manufacturers know that they're a critical part of any client winning that award, and manufacturers also understand that a contract with an assembler is an award in itself.

A tally of industry awards

Since 1990, Ontario assembly plants have won 29 J.D. Power and Associates Initial Quality Study awards, the industry's benchmark for new vehicle quality manufacturing. That's a third of the North American awards in the category.

  • Each year, Canadian subsidiaries of the top auto brands in the world impress and take home industry awards.
  • Ontario operations of GM, Toyota, and Chrysler have all been recognized for their exceptional quality production in recent years.

 

Platinum, gold, silver, bronze . . . the list goes on

  • Since 1990, GM's Oshawa Assembly plant has earned four Gold, four Silver and one Bronze J.D. Power and Associates Plant Quality awards. The plant won a Silver award in 2013.
  • Toyota Canada has won 12 of J.D. Power and Associates Plant Quality awards: two Platinum, six Gold, one Silver, and three Bronze to date.
  • Honda of Canada Mfg. (HCM) Plant 2 in Alliston, Ontario won the Bronze plant ranking for North/South America in the 2013 J.D. Power and Associates Initial Quality Study (IQS).

Top-ranked suppliers

Our automotive parts manufacturers, tool, die and mould makers and other suppliers are also regularly recognized for their top-quality products, groundbreaking innovation and excellence in business.

 

Industry Subsectors

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