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Pierre Boutin loves a challenge — a top-tier posting in Paris, Moscow, or wherever else Volkswagen decides his talents are needed. “You learn the most in tougher experiences,” he says. “Sometimes, it is painful, but you always come out a stronger person at the end of the day.”
Today, Boutin overseas the German automotive giant’s Canadian operations from Toronto as Volkswagen contemplates a massive new undertaking — the construction of a gigafactory somewhere in North America to build electric batteries for its ever-growing fleet of EVs. Speculation is still rife, but Canada remains a strong contender.
With more than 600,000 employees globally, Volkswagen represents a major contender in Canada’s burgeoning EV industry. But it is far from alone. Stellantis N.V. and LG Energy Solution are building a $5-billion battery plant for EVs in Windsor, Ont., Tesla has been mulling a Canadian gigafactory for months, and GM Canada opened its first full-scale EV construction plant in Ingersoll, Ont., at the tail end of 2022.
The race is on — and Boutin believes Canada will be a major player in not only its business plans, but the world’s hopes for cleaner cars. He spoke with the Star last month.
What was your favourite car growing up?
Two cars attracted my attention. First, the Ford Mustang. I won’t reveal my age, but I’ll just say the Mustang came out in 1965, which was my birth year. The second car is the Porsche Spyder, 1955 — not yesterday morning. But the Porsche, over the years, has always attracted my attention. For many families anywhere in the world, cars are one of the major elements of life in one way or another. They have played a role in everyone’s life.
What do you think your toughest working environment was?
Definitely, I would say Russia. I arrived a few weeks before the bombing of Malaysia Airlines Flight 17 in 2014. That was when Russia annexed areas of Ukraine. We went through some major currency devaluation. There was a lot of instability. You didn’t know exactly what the world would be like tomorrow. You didn’t know if we were still going to be doing business in Russia tomorrow.
But I also learned so much, not only from a professional aspect, but also personally — trying to understand what people were looking for. We are not so different. We have different values, depending on whether you are in Moscow or Paris or here in Toronto. But people are people, fundamentally.
In 2019, Volkswagen sales were down 5.4 per cent. Sedan sales had also dropped. Has the situation improved since you took the helm at Volkswagen Group Canada in early 2020?
I like to think the situation has improved despite the obviously very different environment today. We are plagued with a lot of supply-chain challenges. Inflation and two years of COVID were very difficult for anyone on the planet, without an exception for Canada — and certainly not for our customers and business partners.
But this is where we can always improve. Every crisis brings opportunities, and I think we’ve made tremendous progress in the last two or three years in different fields. Maybe it’s not calculated in terms of the number of sales — but I can say very proudly today that Volkswagen Group Canada is a profitable business, which was not the case pre-COVID.
Not only are we profitable today in Canada, but we have growth plans. We’re looking at the future with a lot of optimism. We’re looking at different levels of investment in the country. Is it going to be easy? No. Is everything perfect? No. But we are putting the ingredients in place to make a major impact in Canadian mobility in the future — much more so than we’ve done in the last decade or two.
Volkswagen’s first electric car concept came out in 1972. How has VW’s electric strategy changed since?
Electric vehicle technology has existed for decades. Over the years, a lot of elements of that changed. We now recognize our responsibility toward greenhouse gas emissions, and looking at this problem as a company and saying: we are a leader in mobility. We need to build for future generations and have sustainability over time.
We were the first automaker to sign the Paris Agreement. We develop a net-zero plan for everything we do. Today, we strongly believe in the electrification of mobility. We believe it is the most accessible and ready technology to have a positive impact on greenhouse gas reductions — and at the same time, open up a totally new field in terms of research and job creation. Not only can our company be sustainable, but society as a whole will look at mobility as a chance to be sustainable and bring about a better future.
What’s it been like to sell that vision of an electrified Volkswagen to your current autoworkers? I imagine it must be a really big shift for them.
We’ve manufactured cars for a long time — we’re celebrating our 70th anniversary in Canada this year. We’ve been very good at maintaining an assembly line and getting parts from suppliers, but electric vehicles are a major industrial shift. Today, we need a supply of critical minerals, things we’ve never really touched in the past.
Not only do we want to manufacture electric vehicles, but we also want to be self-sufficient in terms of batteries to equip our vehicles. Our first threshold is to equip at least 70 per cent of our future vehicles with batteries manufactured by Volkswagen Group. It’s a totally new feel. You have to get involved in a lot of different engineering fields that we didn’t touch in the past.
It’s a complete transformation of the company, I have to say, but we’ve done it very well with our factories around the world. We’re transforming some of these factories to produce electric vehicles as we speak. It means a lot of involvement in community colleges to train future workers. There’s still a lot of work ahead, but we’re definitely off to a great start.
How have your conversations about electrification with Volkswagen’s unions gone?
I think the strength of our company is linked to the involvement of union workers, up to our board of directors. They are definitely very well represented, so their perspective is always at the forefront. We’re here to create employment, maintain employment, and to improve it for everyone associated with Volkswagen and our suppliers.
Even if we wanted to recruit a lot of people with expertise in electrified mobility, they don’t exist. The best approach for us is to continually work closely with the union. And they take a major role in the transformation of the company. They bought into our transformation, and that’s why I believe our chances of success are really, really good moving forward.
Volkswagen decided to look for an electric battery factory location in Canada. What makes us so appealing?
Canada has some of the cleanest mining industries in the world. It produces over 30 critical battery minerals like nickel, lithium, cobalt and copper. It has a highly educated workforce. It has proximity to the U.S. market. More than 70 per cent of our energy in Canada comes from renewable sources of energy. We see that the government is working hand-in-hand with the private sector to develop Canada’s capacity to manufacture electric batteries and assemble electric vehicles.
When you look at it, I think Canada will continue to take a major role in the global shift to electric vehicles — not only for the Canadian marketplace, not only for North America, but beyond. So we’re very eager to continue our growth in North America, and we’re definitely looking very closely at the role Canada could play in supporting us in that direction.
Do you have any idea where Volkswagen’s electric battery factory might go?
A few sites are being considered. It’s too early to call. But Canada is very competitive, and has a lot to offer. There are a few sites being considered in Canada, but also outside of Canada — in North America. Canada is in a tough competition right now.
There are people who see electric vehicles as a form of greenwashing — they can still be environmentally damaging, even with the electrification of the engine. What are your thoughts on people who think like that?
I really like your question, because it means we have a lot of work to do to educate the population in general about these choices. With all of the research and investments we’ve made, we strongly believe that the impact of an electric vehicle from its manufacture to its recycling will be far less than the combustion engines we know today. Obviously, as long as you’re using renewable sources of energy.
Electrifying mobility is not just about assembling electric vehicles — it’s to develop a sustainable supply chain moving forward. The role we’re looking at also includes recycling of critical minerals down the road. I think that is absolutely critical, and this is where we believe we can make a real difference. Many people ask how long I think it’s going to take to have a much cleaner supply chain — it’s not a matter of time, as such. It’s a matter of investment from stakeholders making it happen.
Volkswagen is traditionally known as a sedan-based automaker, but North Americans love their SUVs, crossovers and pickup trucks. How is Volkswagen adapting to North America’s love of heavy vehicles?
You’re absolutely right. Until very recently, we had very few SUVs. We were late to introduce SUVs compared to our major competitors. Today, we can count on five SUV models. We need to adapt ourselves to the taste of North Americans, and today, over 60 per cent of vehicles in this country are SUVs. We’re eager to not only provide SUVs to Canadians, but more importantly, provide battery electric SUVs to Canadians. That’s why we also launched our first Volkswagen ID.4. We’ve announced two more models coming down at the end of 2023 and 2024.
We believe electric vehicle SUVs are absolutely essential. At the same time, we’re working on reducing the overall emission of our combustion engines. For instance, the large SUV we have called the Volkswagen Atlas comes in with a very powerful and fuel efficient four-cylinder engine, something people would not have foreseen a few years ago.
So when you put the effort into it, you can provide what Canadians want in an SUV while also making sure you’re building in a very responsible approach toward the environment. It’s not a sacrifice. We need to achieve both.
This interview has been edited for length and clarity.
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