Page 6 - July-August 2025 REPORTER - optimized

MESSAGE FROM THE PRESIDENT

LESSONS FROM CHINA

TREVOR SMALL
LBMAO President

was reading recently about the Chinese auto industry and how it They also use their labour force to their benefit to make prices
I is developing compared to the North American industry. Less than cheaper. In the tech industry some have implemented a “996” work
twenty years ago Chinese made cars were considered poorly built and culture where employees work 9 am to 9 pm, 6 days per week. In
an inferior design. Now they are the largest producer and exporter of many industries they have staff live on their campus in dormitories,
automobiles. It has the largest domestic market, particularly in the providing housing and food for their staff. Staff are fully engaged in
electric vehicle sector (EV). This growth is the result of strong demand the development process.
in China for automobiles, rapid advancements in EV technology and
government support. Many Chinese auto manufacturers like China Again, how does this affect housing in Ontario?
Honda Automobile and SAIC-VW were born out of a partnership with Our governments, both federally and provincially, are pushing for
other global auto manufacturers. They used these partnerships to more modular housing, seeing it as a quick fix. They feel they have a
gain an understanding of the design and manufacturing process, and mandate to get homes built, cheaper and faster. Retailers of building
now their industry is growing much faster than the other global auto materials need to be aware that there are other countries working on
makers. Chinese auto exports were 544,000 units in 2010. By 2015 plans to sell and export their housing solutions into our market.
that number had grown to almost 700,000 units and by 2020 it grew Many in the industry are well aware of the problem with toxic
to just under 1,000,000 units. By the end of 2024 that number had drywall that was made in China and shipped into North America
exploded to over 5.9 million units. In less than 15 years the industry between 2001 and 2009. The drywall was found to contain high
has seen unprecedented growth in an industry that normally relies on levels of sulfur compounds which emitted toxic gas. The peak of the
small single digit expansion. problem was identified in 2006 and 2007. The sulfurous gasses
led to problems with corrosion of copper wire and pipes. It also
Why all the talk about automobiles? This is a magazine for the building caused health problems such as respiratory issues, headaches, and
materials industry. nosebleeds.
Housing may be the next area that the Chinese manufacturers The building material manufacturers in China have learned from
focus on. I had one of my key people who spent a number of years in those problems and they will be better prepared for their next push
China setting up factories to build Canadian home building designs into our market. I believe we will see some element of modular or
and methods in China. There are a few reasons that the Chinese auto prefabricated home construction being exported into Canada in the
manufacturers have grown so quickly. Volkswagen, Ford, and Toyota all next five years. When I was in Central America in February, Chery,
have been amazed that they can accelerate the development time for a Geely and BYD car dealers were the predominant brands of new cars
new model from traditionally 4-5 years down to 18-24 months. They for sale. All EVs were from China. Our market would be flooded with
are more than willing to use technology to speed up the development Chinese built EVs now if our government and the US government had
cycle. Traditional manufacturers test and retest things a certain not blocked them in the fall. Is this better for the customer? Not sure.
number of kilometres before they will put a change into place. I read Does the block help the North American car suppliers – definitely!
about one individual who now works for BYD and who used to work Suppliers and retailers need to pay attention to what is happening
for Volkswagen. He said if he changed the background colours on a around the world. The far side of the world is a 14-to-20-day ride in a
GPS unit at Volkswagen, they would have had to test that change over shipping container away. It takes 4 to 7 days just to get things shipped
75,000 kilometres for each car model that it would be installed in. The from Vancouver to Toronto so the distance may not be the issue. We
Chinese are willing to move their testing into AI technology. It may not need to make sure that we protect our industry and ensure that it is
be foolproof, but it does get them to market quicker. successful in the future.
6 LBMAO Reporter - July-August 2025 www.lbmao.on.ca