Our History

The APMA - Historical Review

With its origins dating back to the late 1920’s, the Automotive Parts Manufacturers’ Section of the Canadian Manufacturers’ Association was formed to co-operate with the manufacturers of automotive vehicles to convince the Government of Canada of the importance of this industry to the Canadian economy.  It was commonly recognized that the only sound basis of establishing an Automotive Industry in Canada was in the production of U.S. designed vehicles.  In that era, the logical thinking was to largely assemble vehicles from automotive parts imported from the United States.  Further, it also became quite evident that the only way for Canada to get proper recompense for paying higher prices than those that prevailed in the United States was to genuinely manufacture vehicles in Canada, necessitating the need for adequate incentives to promote and nurture the development of facilities in Canada for producing automotive parts and materials.

During negotiations with the Government of Canada prior to the 1950 meeting of the General Agreement on Tariffs and Trade (GATT) in England, to protect the automotive parts industry as a whole, a concession was agreed to, which had adverse affects to the Canadian production of some automotive parts.  The adverse concession agreed to was a result of lack of support mechanisms and time arising from absence of a centralized voice, truly representative of the automotive parts industry.  The result was the formation of the Automotive & Aircraft Parts Manufacturers’ Association (Canada).

The 1950s

The Association was formally incorporated on August 18, 1952 in the Province of Ontario as Automotive and Aircraft Parts Manufacturers’ Association (Canada) and began operating on October 1, 1952.James Armer of Dominion Forge, along with Mr. N. P. Peterson of Canadian Acme Screw and Gear (Malcolm Jolley substituted in his absence) and Charles McTavish of the Perfect Circle Co. were the three founding Directors with James Armer as the first President corresponding to Chairman today.  He held this position until April 1963, the longest person to serve as Chairman in the history of the Association.

apma-Annual-Meeting-1953In 1952, 92 companies joined to become founding members.  The First Annual Meeting on April 21, 1953 saw the membership grow to 107 member companies with $19,237.62 in the bank.

The GATT came into being in the immediate post-war years but was just getting started in the discussion phase between the developed and developing world countries.  Hence, the appointment of Don Wood, a tariff expert to run APMA.  Don remained with the Association until 1974 when he retired.

In that era, high customs tariffs still existed worldwide and were the main obstacle to any expansion in world trade.  Import duties also constituted a major portion of government revenue and countries were reluctant to give up that source of income, as a result, limiting trade and export opportunities. When APMA was founded, the key objective was to open up markets for members to sell their products, automotive parts, to the Big Three automakers. Foreign vehicles then meant the British and German manufacturers; the Asian car and truck makers were virtually unknown.  During this period, the Canadian automotive industry was relatively small.  In fact, Canada manufactured less than 400,000 vehicles compared to the 7.8 million vehicles manufactured in the United States during this period.

apma-annualMeeting-1955It must be remembered that during World War II Canada was heavily involved in aircraft production, which continued at a lesser pace in the early post-war period.  For this reason, aircraft parts production was an important industry and was linked to the automotive parts manufacturing sector.

On May 2, 1956, the official name of the Association was changed to Automotive Parts Manufacturers’ Association (Canada).  This change formally distanced the Association and the automotive parts industry from the aircraft-manufacturing sector.

During this time, vehicles built were not overly sophisticated, the number of automobile manufacturers were few and manufacturing processes were not automated.  Just-in-time inventory systems were unheard of, as were automated assembly lines. In 1952, there were the Big Three automakers in North America and those companies vertically integrated, manufacturing most of the components themselves for the cars and trucks that each built.

The 1960's

In 1962, Canada as a whole imported $600 Million of automotive parts annually and exported only $40 Million to the United States. Trade with the United States was plagued by high tariffs and reluctance on the part of vehicle manufacturers to buy Canadian-made automotive parts. Both APMA and the Federal Government felt that free trade would benefit the industry. Through the endeavors of the APMA and most especially the tireless efforts of Don Wood and a smart negotiator in Ottawa named Simon Reisman, then Deputy Minister of Industry, the Canada-United States Automotive Agreement, or the Auto-Pact as it is generally known, came into being in 1965. The Auto-Pact covered only original equipment parts and did not cover aftermarket products. Gerry Mitchell, Woody Morcott’s predecessor as Chairman and CEO of Dana Corporation, was Chairman of the APMA at that time (1965-67) and President of Hayes Steel Products Ltd. in St. Catharines, before it became Hayes Dana.apma-meetingThe 1965 Auto-Pact between Canada and the United States allowed APMA and its members to experience significant growth in the years after by allowing Canadian manufacturers easier access to the U.S. market. With the reduction and elimination of tariffs this trade agreement provided Canadian companies the opportunity to compete on a more level playing field. Combined Canadian motor vehicle and automotive parts production totaled less than $2.9 Billion in 1965 with employment in the automotive parts sector of 37,000 people.

apma-directors-1960sAt the time, Canadian parts producers were inexperienced in selling to the U.S. Vehicle companies and accordingly received much assistance from the Canadian Government’s Consulate in Detroit in setting up broker contacts, etc. Canadian manufacturers were slowly adjusting their strategies for selling to the North American market to take full advantage of the Auto-Pact. The “big sell” as it was nicknamed required significantly larger amounts of part varieties, something that Canadian manufacturers were not prepared for. Additionally, machinery shortages in Canada and Canadian import taxes on manufacturing machinery further delayed progress. The United States and the Canadian Customs authorities were not experienced in dealing with duty free products and had much difficulty in interpreting the terms of the Auto-Pact. By 1969, combined Canadian motor vehicle and automotive parts production had risen to just under $4.2 Billion with automotive parts employment of 44,500 people.

The 1970's

As late as 1972, one of the key roles of the Canadian Consul General in Detroit was monitoring the automotive agreement and trying to resolve some of the disputes with U.S. Customs. The Canadian Consul General in Detroit at the time was Morley Bursey, who remained there until retirement in 1976.

apma-directors-1970sIn March 1973, in an effort to increase Canadian sales to the U.S. vehicle companies and incidentally to assist them in meeting their Canadian value-added requirements under the Auto-Pact, a two day Marketing Seminar was arranged by the Consulate in Detroit and hosted by the Federal Department of Industry. Five senior buyers of the four vehicle manufacturing companies held one-on-one meetings with about 120 automotive parts manufacturers with a view to their placing orders in Canada for many items, some of which were then in short supply in the U.S.

This was the forerunner of many future meetings of this type in Detroit and Canada. The new Automotive Division of the Department of Industry in Ottawa prepared the only directory of Canadian parts manufacturers at the time. One of the Trade Commissioners was assigned full time to promote Canadian automotive parts trade with the United States and traveled throughout Ontario to locate suppliers who were not listed in the automotive directory. The list of Canadian suppliers assembled by the Consulate later formed the nucleus of the Federal Government’s Industry Department automotive parts manufacturers directory. At a later date, APMA took over the responsibility of publishing this Directory with government support, a process which continues today.

seminarIn July 1974, Patrick J. Lavelle was appointed President of APMA. Prior to Pat joining APMA, he was Special Assistant to several senior cabinet ministers in the Federal Government so he was well respected and familiar with the Federal Governments’ inner workings. He was an outstanding negotiator which was clearly demonstrated over the next decade. During that period, Victor Van Der Hout was Chairman of APMA in 1974 and was elected Honourary Chairman in 1976 which title he held until his death in 1990.

By 1975, the value of all Canadian automotive shipments had risen to $9.3 Billion with the automotive parts and accessories industry accounting for $3.3 Billion of this total and employing 46,000 people. By 1980, these values escalated to $15 Billion and $5 Billion, respectively.

The 1980's

In the late 70’s and early 80’s imported cars from Japan made great inroads in Canada and the United States. In fact, by 1980, imports from Japan accounted for 15% of all new vehicle sales in Canada with other imports accounting for 6% of the 930,000 vehicles sold. Throughout the 1980’s, the Japanese import values fluctuated greatly reaching a peak of 25% in 1989 with other imports reaching a peak of 12.5% in 1985.

Canadian and U.S. companies were unable to sell parts to Japan’s car companies despite numerous trade missions and government to government discussions. Eventually import quotas were instituted by the U.S. and Canada on Japanese vehicles. These controls were eventually stopped and in 1984 the Japanese vehicle producers (JAMA) agreed with the Canadian Government to set up the Pacific Automotive Corporation Inc. (PAC) with headquarters in Toronto to work with APMA in promoting cooperation between the Vehicle and Parts industries in Japan and Canada. PAC did much to promote business relations in automotive products between Canada and Japan. APMA’s Pat Lavelle and Morley Bursey negotiated the terms of the agreement with PAC on behalf of the Association.

pac-apma-seminarPAC had much to do with the setting up of vehicle plants in Canada by CAMI (a joint venture of Suzuki and General Motors), Honda and Toyota and this resulted in the opening up of parts supplies by Canadian producers to these companies. Many joint-venture agreements between Japanese and Canadian parts producers have also taken place, both in Japan and Canada and sales to Japan and Japanese transplants have been increasing ever since.

Over time, several agreements on the remission of Canadian import duties were arranged by APMA between the Canadian Government and foreign vehicle producers based on the percentage of Canadian Parts content in such vehicles exported to Canada.

With foreign market opportunities slowly becoming available, globalization and mergers and acquisitions in the automotive sector were quickly becoming strategic necessities for competitiveness, sustainability and growth. APMA embarked on new initiatives to assist members in this regard by promoting and co-ordinating trade missions to Japan, Europe, South Korea, Mexico and the United States, etc. in cooperation with the Federal and Provincial Governments. These initiatives continue today.

In 1981 and 1982, APMA conducted with financial assistance from the Ontario Government, an Automotive Products International Trade Show named “SITEV America” at the Automotive Building on the CNE grounds. Governor Bill Milliken of Michigan and Premier Bill Davis of Ontario opened the first show. This show was later discontinued when APMA joined with “Automotive News” of Detroit in 1984 in a joint International Trade Exhibition at Cobo Hall, Detroit called World Expo.

Pat Lavelle was given a two year leave of absence in April 1980 to serve as Ontario’s Agent General in Paris and Morley Bursey succeeded Pat on a two year contract in April 1980 to manage APMA until Pat’s return in 1982. When Pat Lavelle returned, Morley Bursey was invited to remain on as Executive Director. Dennis DesRosiers was at that time and since 1979, APMA’s Director of Research until his departure in the mid 1980’s.

apma-team-1980sIn 1982, a business plan was prepared by APMA for the Government of Ontario on the establishment of the Ontario Centre for Automotive Parts Technology which was set up in St. Catharines in 1983 under contract with the Government of Ontario. This Centre was most beneficial to the automotive parts industry and assisted greatly in promoting new technology within the industry. According to plan, the Centre became self-supporting in 5 years and was then privatized.

In 1983, at the request of the Minister of Industry Canada, Pat Lavelle chaired a Task Force Committee to report on the future of the Canadian Automotive Industry. The Committee included members from the vehicle manufacturers, APMA and the C.A.W. The Task Force Report set the stage for the promotion of the industry along the lines that has evolved over the years.

Throughout the first 25 years, APMA’s member roster remained relatively stable with a consistent but nominal growth rate. However, by the early 1980’s, the growth rate was beginning to escalate upwards and membership rose to twice its former size. By 1982, aggregate Canadian vehicle shipments and automotive parts was $20.2 Billion with $5.9 Billion of this total attributed to automotive parts.

That year Canada produced 1.2 million vehicles of the 8.7 million vehicles produced in North America and employment reached 53,600 in the automotive parts manufacturing sector.

Pat Lavelle left APMA in January 1986 to become Ontario Deputy Minister of Industry and Trade and Morley Bursey remained to manage APMA until the end of 1986.

At the end of 1986, Victor Lonmo was appointed President of APMA to succeed Morley and remained with APMA until September 1988. In September 1988, Morley was again invited back by the APMA Board of Directors to take over the management of APMA.

By the end of the decade, in 1989 Canadian automotive parts production had grown to an astonishing $14.7 Billion industry, a growth of almost 150% in just 7 years with employment levels exceeding well over 77,000 people.


The 1990's

Steve Van Houten, a former legal advisor at General Motors Oshawa was appointed President of APMA in January 1989 and Morley remained to assist until 1992. During this period, the stage was being set for the next wave of significant growth for the Canadian automotive parts industry. The American Free Trade Agreement (FTA) was negotiated with APMA’s input to the Government of Canada to include the Auto-Pact of 1965 verbatim in the FTA. On April 9, 1991, the name of the Association was formally changed to Automotive Parts Manufacturers’ Association (APMA), the name still used today.

apma-directors-1980sWhile FTA proved to be somewhat controversial at first with fears of job losses and manufacturing plant closures, it’s clear that over time, the FTA has been the most beneficial trade agreement ever for the automotive parts industry in Canada. The beginning of FTA coincided with a global recession but by 1992, the economic hurdles had been overcome and the Canadian automotive parts industry in Canada began to flourish and had grown back to its $14 Billion level of 1989.

Globalization, mega-mergers and the electronic interchange of data became a reality. This created opportunities and vulnerabilities for most members of APMA, in particular, the smaller companies. The vehicle manufacturers now operating in many different countries continued to seek out single source suppliers to supply their global operations. Computerized processes and robotic technology became common place and transformed the automotive industry in the design, manufacturing processes and vehicle assemblies.

During this same time period, APMA made another strategic decision that has benefited its membership and the industry significantly. As a result of the significant growth in the Canadian automotive parts industry, APMA’s Annual Conference began to prosper and it was determined that this event should be grown to satisfy the need for increased promotion, networking opportunities, collaboration and knowledge sharing within the Canadian automotive parts industry. The APMA Annual Conference and Exhibition was moved to a larger, more centralized location within Ontario to accommodate increased delegate attendance, minimize delegate travel time and facilitate and foster the growth of the Exhibition component as a venue for Canadian automotive parts producers and suppliers to the industry to promote their products and services to each other and the world. On an annual basis, OEM manufacturing executives are invited to participate in the conference to maximize participant exposure. In the early 1990’s, attendance at the Annual Conference was under 400 people with 30 exhibitors.

In 1992, Steve Van Houten left APMA to accept the Presidency of the Canadian Manufacturers Association. He was succeeded by Neil De Koker, a former Vice President of Magna International and Chairman of APMA (1990-91).

In 1993, the Canadian automotive parts industry had sales of $16 billion and employed over 77,000 people. APMA and its members embarked on a new initiative and entered into a voluntary partnership agreement with Environment Canada for the Canadian automotive parts sector to seek a verifiable reduction and/or elimination of the use, generation, or release of toxic substances to achieve a better environmental, social and economic future.

In 1994, the American Free Trade Agreement (FTA) was succeeded by the North American Free Trade Agreement (NAFTA) which added Mexico to the existing FTA between Canada and United States. Once again APMA, along with the Government of Canada were adamant that the 1965 Auto-Pact be included verbatim in NAFTA and to form part of the agreement, which eventually happened. NAFTA was the third significant trade agreement to positively affect the Canadian automotive parts industry. The performance of Canadian automotive parts manufacturing companies has long proven that they can and do successfully compete with manufacturers anywhere given the opportunity, most notably evidenced by the historical stellar growth record starting after the strategic 1965 Auto-Pact followed by the late 1980’s FTA and subsequent NAFTA in 1994.

In 1995, Neil De Koker resigned and was replaced by Pete Mateja as President of APMA. Pete was a former President of Navistar, a significant truck manufacturer at the time. In 1997, Pete Mateja resigned and was replaced by Gerry Fedchun as President of APMA, a position he held until 2009. Gerry is the former Chairman and CEO of ITT Canada and started in the automotive industry as an engineering student for General Motors in 1964.

With the advancements made in manufacturing processes, built-in quality requirements, efficiency and accountability began to transfer from the assemblers to the parts manufacturers. In order to take advantage of innovation and technological advances, training and re-training became critical components for the automotive parts manufacturers.

APMA recognized early on that there would be a critical shortage of highly skilled labour in the future that would cause the automotive parts industry significant hardship. To that end, APMA initiated an Outreach program promoting to students in high schools, colleges and universities the opportunities available and the need for technically skilled employees.

In addition, APMA and its members created the Yves Landry Foundation (YLF), in honour of the late Yves Landry, former CEO of Chrysler Canada who was a strong supporter of linkages between industry, education and government. The goal of the YLF is to encourage and recognize significant contributions in technological education, which, in turn, will increase awareness of the shortage of technically skilled people.

apma-directors-1990sBy 1999, the Canadian automotive industry reached $73 Billion with the automotive parts industry accounting for $30.5 Billion of this total. This again represents a significant growth rate in six short years. By 1999, Canada accounted for the production of over 3 million vehicles of the 17.6 million vehicles produced in all of North America and employment levels approached 100,000 people for the automotive parts sector.

The 2000's

The turn of the century brought about a continuation of the growth experienced by the Canadian auto industry in the late 1990’s, including the auto parts sector. By 2004, the sector as a whole had reached over $106 Billion in shipments and the parts sectors had grown to over $35 Billion. APMA’s Annual Conference and Exhibition kept expanding and reached over 120 exhibit booths. However, there were under currents forming that would later impact the industry and its employment.

The sudden passing of Yves Landry, Chairman, President and CEO of Chrysler Canada Ltd. in the late 1990’s saw the creation of the Yves Landry Foundation (YLF), an initiative of the APMA seen as a fitting tribute to his legacy. Landry had a vision of creating close partnerships between industry and education to facilitate the training of world class manufacturing employees by fostering collaborative education approached between industry and educational institutions. APMA executives and our industry shared this vision as well. The YLF celebrated this by annually hosting an Awards Gala honouring industry and institutions who advanced the vision of Yves Landry. This subsequently led to the creation of the federally funded Council for Automotive Human Resources. The YLF is still in existence today.

The early 2000’s saw the emergence of significant growth in the Southeastern US region as a production hub featuring significant new production capacity investments from Nissan, Mercedes, Honda, BMW, and later Hyundai/KIA. This coincided with the dissolution of the Auto Pact in 2001 by the WTO which had provided a support base for vehicle assembly in Canada and saw the accession of China into the WTO.

In 2002, senior industry executives, labour, academia and the Federal and Provincial Governments, created the Canadian Automotive Partnership Council (CAPC). CAPC was formed to help address key competitive issues facing the Canadian automotive industry and to guide governments on strategic issues impacting the Canadian automotive industry.

This time period also saw the rise of low-cost markets like Eastern Europe, Mexico, China and India. Many of these markets provided strong potential for domestic supply growth while also becoming a source for low cost procurement due to their relatively low labour rates. Purchasing executives placed significant pricing pressures on North America suppliers by benchmarking supplier pricing based on emerging market costs, which were substantially lower in many instances, resulting in significant hardships for North American suppliers, forcing restructuring and lay offs to help strengthen their competitiveness.

North America also experienced significant expansion of Japanese led manufacturing during this period, including expansion and creation of new assembly facilities at Toyota and Honda in Ontario, followed by their Tier I and 2 suppliers.

Throughout this period, APMA continued its marketing support and outreach programs to foreign markets, to help support Canadian companies in expanding and growing abroad. In collaboration with the Canadian Government, the Provinces and Export Development Canada, the APMA led numerous trade missions and created Canadian Pavilions at industry events in each of the key emerging auto markets.

By 2007, the auto industry was beginning to see signs of significant slow downs in the sector and by 2009, the industry became a significant casualty of the “Great Recession.” While the broader Canadian economy did not fair as badly as the United States and elsewhere during this recession, due to the integrated nature of the Canadian auto sector in North America and globally, our industry was significantly impacted.

A global auto recession emerged with production dropping precipitously. A reduction in Canadian light vehicle production followed, dropping to a low of 1.8 million units from a high of 2.7 million five years earlier. Following suit, auto parts supply sector shipments dropped to $19.16 Billion from a high of $35.4 Billion. Employment similarly dropped to 59,878 people from a high five years earlier of 97,300. The result was the controlled bankruptcy of General Motors and Chrysler, followed by a series of supplier companies. Ultimately, the Governments of Canada, United States, Ontario and Michigan intervened with financial supports, preventing a total collapse of the industry and the supply base.

Operationally, APMA also came under extreme pressure during this period due to industry consolidation and plant closures, but ultimately persevered. By 2010, the industry had begun to turn around.

Recent Headlines

Sourcing Guide