That's one of the main questions to be addressed by a new, multidisciplinary study of the auto sector by a team of eight professors and 52 postdoctoral fellows and graduate students from McMaster University, University of Toronto and Queen's University. They will work with Toyota Motor Manufacturing Canada (TMMC), Ford Motor Company of Canada, the Automotive Parts Manufacturers' Association and the Canadian Autoworkers Union to map the current state of the industry and examine what best-practice policy can be developed to strengthen it. This is the largest and most comprehensive study of this sector since a 1985 Royal Commission report set the stage four years later for the North American Free Trade Agreement (NAFTA).

Greig Mordue, General Manager at TMMC, stresses they are not looking to government to solve the industry's challenges.

"We have to fix this for ourselves—both industry and government understand that," he says. "Instead, we need to look at what we can do collectively to ensure that we continue to have a healthy and vibrant industry."

Automotive Partnership Canada (APC) is contributing $2.1 million to the five-year study.

The study will examine policies within Canada and elsewhere related to tax, labour, training, the environment, education and innovation, as well as research and development incentives and government procurement. The project will include multiple case studies and insights gleaned from interviews with up to 350 people in industry, labour and government. Quarterly reports will be provided to partners so they can respond as new data become available.

"We're not developing an industrial strategy for the automotive sector. Rather, we will map out Canada's comparative advantages and automotive industry capacity, including future industry trends, and explore how public policy can contribute to the growth and improved competitiveness of the Canadian automotive industry," says lead investigator Charlotte Yates, an expert in the automotive industry and public policy at McMaster University.

Yates notes that competing countries like China, Germany and South Korea all use government policy to strengthen their automotive industry's global competitiveness and its potential for economic growth. Even the United States has renewed an active approach to automotive policy in the wake of the 2008 financial crisis that saw two of North America's largest automakers file for bankruptcy protection.

"If there is going to be a seismic shift in the industry over the next 20 years," adds Yates, "we need to understand how that might impact the automotive supply chain and what might it mean in terms of future capabilities, such as training."

The project—the first social sciences study funded by the APC initiative—will also train dozens of new researchers in an economically critical sector where there is a dearth of academic expertise in Canada.

"There aren't a lot of HQP (highly qualified personnel) who understand the automotive industry in terms of the economic and societal impacts," adds Mordue. "This project is one way to generate that capacity."