Ontario an alternative to Silicon Valley?

Silicon Valley, Calif., may be the darling location for automotive employers to recruit software talent and maintain research centers for new-age technologies. But some major companies have pegged Ontario sites to staff up for advanced development work.

From a Detroit perspective, Ontario is closer to home and potentially less expensive. And the Canadian government is eager to help.

Ford Motor Co., General Motors and Canadian powertrain parts supplier Linamar Corp. have all embraced Ontario to expand their focus on autonomous and driver-assist technologies and other software development.

• Ford invested a total of $380 million into its new operations in the Ontario cities of Ottawa, Waterloo and Oakville over the past two years.
• In May, GM Canada announced a $129 million investment in its Oshawa assembly plant property to develop the Canadian Technical Centre McLaughlin Advanced Technology Track.
• Linamar, based in Guelph, Ontario, invested $500 million last year in a program that includes the opening of an innovation center.

The projects have been part of a $1 billion investment wave in Ontario's technology corridor as the province steps up its push for auto technology and smart-mobility projects. Ontario added more tech jobs in 2018 than San Francisco, New York and Washington combined, according to a 2018 report from CBRE Canadian Research Center.

"Ontario also enjoys significant cost advantages for technology companies compared to the U.S.," Kwok Wong, spokesman for the Ontario ministry of economic development, job creation and trade, told Automotive News. "Silicon Valley is almost twice as expensive as Ontario's tech corridor."

Wong says Ontario is attempting to persuade more automotive employers to consider r&d operations closer to their other operations in the Great Lakes region. In February, Ontario launched what it calls its Driving Prosperity strategy to further position the province for the growing auto and technology corridor.

Ford has recruited more than 500 employees in Ottawa, Waterloo and Oakville as connectivity and innovation center teams, focusing on software development and testing across infotainment, in-vehicle modems and high-speed connectivity.

The latest version of Ford's Sync 3, which debuted in the 2020 Ford Explorer and Ford Escape, was the first to be fully developed, tested and delivered entirely by the Ontario group, according to Ford Canada spokesman Matt Drennan-Scace.

Ford did not have an r&d presence in any of the locations in Canada before the investment, Drennan-Scace said. The Canadian federal government and Ontario's provincial government each provided Ford with about $92.5 million in incentives.

"We knew that these three locations — part of Canada's high-tech corridor — had people with the skill sets we needed to develop our next generation in-vehicle infotainment and connectivity solutions," Drennan-Scace said.

"A large number of employees currently working at Ford's Connectivity and Innovation Centres in Ontario are former BlackBerry employees who brought the expertise we were looking for in-house," he added, referring to the Canadian telecommunications firm. "With the talent already in place in these locations, it made sense to open up our own offices where the talent already resided."

GM Canada opened its Canadian Technical Centre Markham Campus in January 2018 to introduce a focus on advanced mobility innovation to the area, said Jennifer Wright, a GM Canada spokeswoman.

This year's investment in what GM called the Oshawa transformation included a 55-acre outdoor test track for in-vehicle testing. Construction began on the track this fall, and it is expected to be operational in the spring.

Both locations will develop software and hardware for AV systems, embedded controls, active safety systems and infotainment. GM Canada hopes to employ 1,000 software development engineers by growing the two campuses and its Cold Weather Testing Facility in Kapuskasing, Ontario, Wright said.

GM additionally has plans to build a new mobility campus in downtown Toronto, projected to open in 2022.

No Ontario government funding was provided for General Motors' new Canadian Technical Centre in Markham, according to Wong. The federal and Ontario governments committed to $100 million in Linamar's innovation center. That project is expected to create 1,500 jobs in advanced manufacturing technologies.