Michelle Lambías Meunier, president and CEO of Propulsion Québec, met on Tuesday before the unveiling of the results of the American election, qualified her remarks. At that moment, we were still in the conditional, when we believed that it might have taken several days before knowing the outcome of the elections.
“The result of the American elections will surely have an impact,” she summarized. “But I don’t think it’s going to be black or white.”
The CEO of Propulsion Québec confirms that Donald Trump said he would like to cancel all the funds that were not distributed in theInflation Reduction Act (IRA), enacted by the Biden administration. “But it’s not so simple to go back on agreements and regulations that have already been made,” she says.
If the IRA falls in the United States, Canada’s federal government will have to withdraw its promises of subsidies for battery factory projects. “There is a mirror principle with the IRA. If subsidies increase on the American side, they will increase here. But the opposite also applies.”
But she adds that it wouldn’t be that simple to cut the IRA.
“Some Republican states, such as Arizona, Georgia, Indiana, Nevada, and Tennessee, benefit the most from the IRA. There would be Republican legislators who would not be in favor of suspending the IRA at all.”
— Michelle LLambías Meunier, President and CEO of Propulsion Québec
And the same would be true for zero emissions mandate standards. “THE ZEV mandatesas they are called, are state courts. Even if the new president says he is axing the obligation to buy electric vehicles, states are independent in these decisions. It belongs to them,” she adds.
However, not knowing whether the IRA will be scrapped or not, the battery factory projects of Northvolt, in Quebec, and those of Volkswagen and Stellantis, in Ontario, are in danger. The CEO confirms that the Northvolt project in Quebec is highly strategic. “Leaders remain attentive,” she says.
At Lion Électrique, the manufacturer of electric buses and trucks says it is offering its full collaboration to the new administration on key issues, including the energy transition and the electrification of transportation.
“It is still too early to assess what the impacts will be on our sector,” replies Patrick Gervais, vice-president, truck and public affairs at Lion. “Regarding transportation electrification programs, such as the EPA Clean School Bus Program stemming from the bipartisan Infrastructure Act [Bipartisan Infrastructure Law]adopted in 2021, and Clean Heavy Duty. They are well advanced, with funds already allocated to operators, school boards and manufacturers.”
He continues by hoping to see these initiatives continue. “We are also seeing momentum around other programs at the state level. We can think of California, Texas, Michigan, Colorado, Illinois, New York, etc. We will obviously follow the outcome very closely,” continues Mr. Gervais.
Customs tariffs
With Donald Trump, we are in almost systematic opposition to all imports, says Ms. LLambías Meunier. With an imposition of customs tariffs of 10%.
“It could hurt us, because we export a lot to the United States. There are many SMEs that export. And to have a systematic taxation of 10% in several sectors, I am thinking of steel, aluminum, batteries, lithium and strategic materials,” she lists.
“The effects are likely to be felt in the longer term,” she said Thursday morning in a telephone interview. “Because American companies will probably rush to place orders before the tariff measure is put in place. There will possibly be an increase in exports in the short term.”
And Ms. LLambías Meunier maintains that we risk seeing more Quebec companies opening branches in the United States in order to remain the Buy American Act.
As for Electric Mobility Canada (MEC), it is too early to guess the impacts of the new American presidency. “The battery industry, like all others, favors stability and predictability. The electrification and mining sectors are seeing growing concerns and uncertainties,” said Daniel Breton, CEO of MEC.
He maintains that US federal investments under the IRA have been largely allocated. “The money has already gone and the movement has not stopped,” he adds.
“Now, will the regulations and rebates for heavy and light vehicles remain? And do EPA standards [Environmental Protection Agency] will they stay the same? We don’t know that…” asks Mr. Breton.
Elon Musk has given his support to Donald Trump’s election campaign. (Evan Vucci/Archives AP)
La variable Elon Musk
Will Elon Musk have some influence in the president-elect’s decisions? “That remains to be seen,” replies Daniel Breton. On the other hand, during his first term, Donald Trump left rebates for the purchase of electric vehicles… But we cannot predict the future.”
“If Trump says that he is throwing overboard everything related to electrification, while Elon Musk supported him in his campaign, that may seem contradictory,” analyzes Ms. LLambías Meunier.
She adds that we must understand that Elon Musk is not just into electric vehicles. “He’s involved in lots of other businesses,” she replies. Instead, he thinks about the future of his various firms. From a tax and regulatory perspective, a Trump administration would be more liberal than a Democratic government. With a State less present in business.”
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