London Inc. Weekly: A summary of regional business news from the past week

Weekly Regional Business Intelligence

Written by Kieran Delamont, Associate Editor, London Inc.

All eyes on PowerCo amid intensifying trade war

Despite U.S. President Donald Trump’s walk-back yesterday, suspending tariffs on CUSMA-compliant exports from Canada until April 2, plus the previously announced 30-day pause on tariffs on Canada-made vehicles, there remains plenty of automotive industry anxiety in the region, particularly in St. Thomas, where they’re doing their best to stay positive and trust that the trade war won’t scuttle the Volkswagen-backed PowerCo battery cell gigafactory. “They’re [PowerCo] hiring people regularly. They’re up over 150 people working in downtown St. Thomas now. Even with the unnecessary trade war that’s happening around them, the site’s ready to go,” St. Thomas Economic Development Corporation CEO Sean Dyke told CTV News London. “PowerCo isn’t intending to start production until 2027, so these short-term impact of trade wars maybe don’t have the same impact on them as it would to existing companies.”

The upshot: Automakers got a 30-day reprieve from Trump, but that seemed to spark even more anxiety in Ontario, with many industry watchers saying the automotive sector, and not Fentanyl, is being revealed as the true target in the intensifying trade war. Looking purely at the case of the VW plant, it’s hard to say exactly what might happen ― the timelines mean they can probably wait out the trade war, and they would still need imported minerals if they were to take the plant to the U.S. Some are not as confident as Dyke though. “If the product is not competitive in your largest market, which is nine times as big as Canada overall, then ― you know ― this becomes a very easy decision,” said Andreas Schotter, professor of international business at Ivey Business School. Officially, PowerCo isn’t saying anything, other than stating that it is “too early to speculate on the impact the newly announced tariffs could have on the automotive industry.”

Read more: CTV News London

Real estate woes continue in February as market confidence remains elusive

According to the London and St. Thomas Association of Realtors (LSTAR), which released data for home sales in the month of February earlier this week, a total of 476 homes exchanged hands in the region (the LSTAR catchment area also takes in Strathroy, St. Thomas and portions of Middlesex and Elgin counties), a 20.4 per cent decline compared to sales in February of 2024. On the supply side, a total of 1,026 new properties entered the market in February, a decline of 4.5 per cent compared to a year ago, however the total for active listings in the region sits at 2,233, which represents 4.7 months of inventory (a ratio representing the number of months it would take to sell the homes that are currently listed based on current rate of sales activity). “External factors are beginning to shape the Canadian housing market in significant ways,” stated Dale Marsh, LSTAR board chair. “U.S. tariffs on Canadian exports could increase inflation and reduce consumer confidence, further impacting the housing market. These factors, combined with supply chain disruptions and rising construction costs, suggest that the Canadian real estate market is navigating through a period of adjustment and adaptation.”

The upshot: As we head into the spring selling season, uncertainty around tariffs and economic worry are keeping dark clouds over the real estate market. As London Inc. real estate analyst and A Team London partner Marcus Plowright noted in his On the House column this week, with continued economic uncertainty and the ongoing trade battle, ambiguity is the theme of the day. “As for the future ― no one knows,” said Plowright. “Regardless of what the orange-haired monster decides or changes, it can’t be predicted, and we must assume the worst. That torture of uncertainty, the risk of economic downturn, the inevitable loss of jobs, the increasing cautiousness of lenders ― all this will lead to an ongoing anemic real estate sector.”

Read more: London Inc. | London Free Press

Western considers outsourcing first-year international student education

Western University, which is facing its first deficit in 25 years, said it is again considering a partnership with private education company Navitas. At a recent university senate meeting, provost Florentine Strzelczyk announced that the school is considering outsourcing the educations of first-year international students to the Australian private education company. “No one is coming to save us,” Strzelczyk said. “We need to find our way to move our university forward in a context that is not friendly to us.” The goal, she said, was ultimately to boost international student enrollment and “help students who desire an international education.” It’s receiving immediate pushback from faculty, who also objected in 2020 when the school considered a similar partnership with Navitas. “Outsourcing first-year programming for international students to a private corporation threatens Western’s control over critical aspects of its academic mission,” said a statement from the UWOFA union representing faculty. “The model shifts decision making on curriculum, admissions and student support away from the university and into the hands of a profit-driven company. The reliance on contract-based instructors remains a serious issue, raising concerns about job security, fair compensation, workload protections and the lack of commitment to faculty research.”

The upshot: For the moment, all of this is still speculative. “There’s no proposal, there’s no agreement,” is how Strzelczyk put it at the senate meeting. But the mere talk of a partnership like this is raising a lot of questions. Some faculty see it as “a step towards the privatization of education,” while another criticized the idea as “completely unethical” in speaking with the Western Gazette. Others expressed concern that the idea would isolate international students from Canadian students, suggesting that might start to erode the appeal of an international education in the first place. Interestingly, while schools everywhere are fretting about the international student cap, Western’s management is casting this as a move to boost international enrollment ― the school did not use all its allotted spots, and Strzelczyk suggested that partnering with Navitas would “help with recruiting” and that “trying to move our university forward into that top tier means we need to be globally connected.”

Read more: CTV News London

London’s renoviction bylaw take effect

There’s some cautious optimism among tenant advocates that a new bylaw cracking down on “renovictions,” which came into effect this week, will help provide some stability to tenants in London. The new bylaw requires landlords to apply to the city for a rental unit repair license (to the tune of $600 in fees), which requires a report proving the need for the unit to be vacant. “This bylaw really addresses the pressure tactic of these fake evictions, where a minor renovation is used as an excuse to evict, renovate and then jack up the rent,” said the city’s bylaw enforcement manager Orest Katolyk. “Tenants are tentatively hopeful about the bylaw providing some additional protection,” said ACORN’s Claire Wittnebel. Landlords in violation of the new renoviction bylaw face penalties of between $1,000 and $5,000. “It is more important than ever to ensure tenants are not unfairly displaced from their homes,” Mayor Josh Morgan said in a press release. “This bylaw is yet another tool our municipal law enforcement officers will have in an effort to keep housing stable and accessible for Londoners.”

The upshot: Though getting a renoviction bylaw in place had been a priority of tenant advocates in London, nobody has been all that enthused about what the city passed, with one ACORN organizer damning it with faint praise in September, calling it, “better than nothing,” and landlords grumbling about the additional paperwork. It is, in comparison to some other municipalities, a fairly light-touch renoviction bylaw ― Hamilton’s version, generally cited as the closest comparable, requires landlords to cover the difference in rent while a tenant lives elsewhere, which London’s doesn’t. But city officials hope that London will see a similar effect that Hamilton did when it applied its bylaw in January: There’s no complaints coming in that people are evicted, and no applications yet,” said Katolyk of Hamilton’s bylaw. “Perhaps renovations are being done in a fashion where the tenant does not have to be formally issued an N13. What that tells me is that landlords are aware of the process, and they’re aware of the requirements.”

Read more: CBC News London | London Free Press

Councillors look to change how pay and expenses are reported

How should city councillor’s pay and expenses be reported to the public? It’s one of the questions being asked around the council table right now, with councillors a bit miffed that standard reporting practices possibly giving the impression they are being paid more than they are. (The standard councillor stipend is around $65,000 a year plus benefits and top-ups for the deputy mayors and the budget chair.) Specifically, councillors suggest it would be more accurate to stop including expenses ― which vary but generally come in at between $10,000 and $20,000 per ward ― as part of the total remuneration package and voted this week to direct city staff to separate the numbers in future reports. “I do not want to leave the public thinking that there is, in any way, shape or form, councillors pocketing additional money that is allocated for expenses to their ward,” said Corrine Rahman, chair of the infrastructure and corporate services committee. “I do think that perhaps the way that it’s reported via the media, it sometimes makes it seem as though we are taking home more than perhaps we actually are.” Council will still have to vote to approve the reporting change, but it seems as if most around the horseshoe support the change.

The upshot: If we were to guess, the catalyst for this frustration among councillors might have been a CTV News London report that explicitly included expenses as part of councillor salaries, and gave some the impression councillors were drawing six-figure salaries. The whole thing comes as councillors are having their pay studied by a task force, which is looking at whether councillors are paid enough and if workloads are being appropriately managed. Pay for public officials is almost always a contentious issue ― on the one hand, taxpayers don’t like it when total pay appears exorbitant (part of what’s behind the push to have the reporting more accurately reflect reality), but on the other, a reasonable salary for a public official helps attract talent and disincentivize, well, petty corruption. The early rumblings from the task force, which is set to deliver a report in October, seems to be on the side of upping council pay. “For the amount of work city councillors do, they don’t get paid well enough,” said task force member Mariam Hamou, a former councillor herself. Jared Zaifman, CEO of the London Home Builders’ Association and also a former councillor, said in January that “our city is expected to grow in a tremendous fashion over the next 25 years, and we need to make sure that the right tools are in place so that anyone in the city could come forward and take on the role.”