COMM 5032 EL-12 – Economics

Instructor: Dr. James Bowen

Economics Outlook Assignment

Prepared by:
Stuti Vijaykumar Karia

Due Date: June 18, 2023

Economic Outlook Report for the Province of Ontario,
Canada

1. Summary
2. Overall Economic Outlook for Ontario
3. Major Industry- Auto/Parts Manufacturing
4. Implication for Strategic and Tactical Decision Making
5. Key Concerns and Critical Business Issues for CEOs over the few Years
6. References

Summary

 This report provides an economic outlook for the province of Ontario,

Canada with focus of auto part manufacturing. The discusses the
current state of economy, including key economic indicators such as
GDP, Employment, and Inflation and Provides Forecasts for the next
few years. The report also Examines the nature of demand,
Production, Competition, and Market Strategic and Tactical
Implications of forecasted changes in the provincial and global
economy for firms in the industry. At the end, the report draw
attention to key concerns and critical business issues for business in
the upcoming years.
 Overall Economic Outlook for Ontario

 Ontario is a financial hub of Canada with 6 major sector

Manufacturing, finance and insurance, information technology,
mining, Agriculture, and tourism. According to Moody’s Dismal
Scientist, Ontario’s GDP is expected to grow by 4.4% in 2021 and
4.0% in 2022, while Inflation is projected to remain Moderate at
around 2% over the forecast period.

Illustration: - Major Industry Manufacturing

 The manufacturing Industry is a significant contributor to Ontario’s
economy, accounting for approximately 10.49% of the province’s
GDP and employing over 133,300 workers. The industry is
characterized by innovation in technology and global competition.
Example current gas engine car manufacturer competing with electric
car and hydrogen car manufacturer at national and global level.

 Demand for Auto parts driven by many factors such as increasing

driver population, better road infrastructure and per capital income or
let us say, depends on citizen affordability of automobile. Also change
in Service sector also responsible for high demand of cars like
delivery of food and other product and service after covid19.

 In terms of production, Auto/parts Manufacturing in Ontario is

characterized by many small medium and large manufacturing units.
These Unites are operate differently some just make parts or assemble
at the same time other units do all.

 For an Instance, an oligopoly is a market structure in economy. The

structure only has a small number of firms. Auto part manufacturing is
a good example of oligopoly competition because companies depend
on price, Innovation, quality, and technological edge for higher sales.
 The forecasted changes in the regional and global economy have a
significant strategic and tactical implications for companies in this
sector in Ontario. For example, increase completion form cheap parts
from country like China could put pressure on Ontario base units to
reduce cost, innovation faster and develop new technology to
compete. In addition, change in government policies and regulation
could impact the industry, with potential implications for issues such
as taxes, import cost and labour cost.

 In order to respond to these rapid changes, companies in the

manufacturing industry in Ontario will need to develop technology
and find a way to make product more affordable with quality. For
example, Units may need to introduce more automatic machinery to
reduce cost and produce best quality parts also collaborate with other
brands for their advantage in this competitive market.

 I would like to Summarize the key concerns and critical business

issues for CEOs over next few years base on the KPMG Global CEO
Outlooks Survey and Other Sources:
1) Technology advancement: - to make certain product unit fast
and cheaper manufacturing unites needs to make it more to
reduce cost and for better quality they need good technology.
2) Talent Management: - Companies can invest in training of new
employee to create a skill full work that it was not easy to make
somewhere else, Example: - Toyota engine
3) Environment sustainability: - country like Canada, who this
about environment more that other Asian countries. Unites can
become more environment efficient to take advance of garment
policies and perks for their competitive edge.
4) Change in consumer preference: - now a days, people like to
drive electric car over old gas engine car, CEO can Focus on
introducing new electric model for customer who are looking
for those type of new technology.
 References

 Rebuilding Ontario’s Economy: https://budget.ontario.ca/2022/chapter-1a.html

 Ontario Economic Report: https://occ.ca/wp-content/uploads/2022-Ontario-

Economic-Report.pdf

 Encyclopedia Britannica:
https://britannica.com/place/Ontario-province/Manufacturing

 Invest Ontario: https://www.investontario.ca/industries