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Global auto leaders urge Trump administration to end trade turmoil

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DETROIT (Reuters) – Auto executives gathered in Detroit on Monday called on the Trump administration and Congress to resolve trade disputes, and end the government shutdown, saying political uncertainty is costing the industry.

Ford Motor Company President and CEO Bill Hackett (L) and Executive Chairman Bill Ford attend their company’s presentation at the North American International Auto Show in Detroit, Michigan, U.S., January 14, 2019. REUTERS/Jonathan Ernst

U.S. trade officials are negotiating a new deal with China in hopes of avoiding new tariffs, while a new regional trade agreement with Canada and Mexico still needs congressional approval. Automakers producing vehicles in the United States are contending with U.S. steel and aluminum prices driven higher by Trump administration tariffs.

Fiat Chrysler Automobiles NV (FCHA.MI) (FCAU.N) Chief Executive Mike Manley told reporters at the Detroit auto show on Monday that U.S. metals tariffs will raise the automaker’s 2019 costs by $300 million to $350 million, or about $135 to $160 a vehicle, based on the automaker’s 2018 U.S. sales.

Toyota Motor Corp’s (7203.T) executive vice president for North American sales, Bob Carter, said the company has had to raise prices three times because of higher tariff costs – even though 96 percent of steel in Toyota U.S. vehicles is from U.S. steel plants. The tariffs boosted industry vehicles prices by about $600 on average, he estimated.

General Motors Co (GM.N) and Ford Motor Co (F.N) are also taking financial hits from the U.S. steel and aluminum tariffs.

“Those are headwinds,” GM President Mark Reuss told Reuters. “It’s our job to run the business to offset those headwinds.”

GM Chief Executive Mary Barra last Friday promised investors the company would boost 2019 profit despite tariff-related costs and investments in electric vehicles. She stuck to her plans to target five North American factories for closure and cut nearly 15,000 jobs overall.

About one-quarter of federal government operations have been shut down by a lack of funding since Dec. 22 after President Donald Trump demanded $5.7 billion this year from Congress for building a security wall on the southwest U.S. border.

Manley said the U.S. government shutdown is holding up certification of one of the company’s new heavy duty pickup truck models. Those vehicles are among the company’s most profitable products.

“The earlier it can be resolved, clearly the better,” he said.

Concern in the auto industry about the uncertainty created by Trump’s efforts to revamp trade and environmental policies is weighing more heavily as forecasters call for a slowdown in vehicle demand in the United States and China during 2019.

“There’s a lot of balls in the air right now that are unresolved,” Ford Executive Chairman Bill Ford Jr. told Reuters on the sidelines of the auto show. “Certainty is something we really desire because of our product lead times. We don’t have that right now.”

Ford said the automaker feels its opinions are being heard by U.S. Trade Representative Robert Lighthizer, but he has no idea when the various issues will be resolved.

U.S.-China trade tensions have forced Chinese automaker GAC to delay its planned entry to the U.S. market, Wang Qiujing, head of GAC’s (601238.SS) research and development center, told Reuters on Monday. “We have postponed our launch until the first half of 2020,” he said, adding that the timing will depend on the outcome of U.S.-China trade negotiations. If the current 25 percent U.S. tariff on Chinese-made vehicles continues, “the impact will be very significant,” he said.

GAC has a large display at the Detroit auto show, and is hiring engineers and designers at three U.S. locations, including a new technical office in Detroit expected to employ about 30 people, Wang said.

Auto executives have welcomed the conclusion of a new version of the North American Free Trade Agreement, as the industry seeks certainty for rules that will govern automakers’ long-term investment decisions in the region.

In the interest of greater certainty, they would like to see the U.S. Congress decide quickly on the updated agreement’s fate.

“We just need it resolved,” said Brian Smith, chief operating officer for Hyundai Motor Co (005380.KS) in North America, who added that the automaker needs clarity so it can adjust its supply chain as necessary. “It’s been going on way too long.”

U.S. officials are weighing so-called Section 232 national security tariffs on imported vehicles. That tariff would not hit U.S.-made models, but some analysts warn it could trigger a sales slump as prices for European and Asian-made models jump.

Slideshow (5 Images)

“The decline in volumes could be larger than a recession would produce,” Jonathan Smoke, an economist with auto market information company Cox Automotive, said during a briefing on Sunday.

Volkswagen AG (VOWG_p.DE) CEO Herbert Diess on Monday announced the German automaker would invest $800 million in its Chattanooga, Tennessee, plant and add 1,000 jobs to build electric vehicles as it faces pressure from the Trump administration.

VW is worried the Trump administration will move ahead with new tariffs and hopes the new investments will help the German automaker avoid them. “We have strongly been encouraged to invest more, which we will do,” said Diess, who met with Trump last month.

Reporting by Ben Klayman, David Shepardson, Nick Carey, Paul Lienert and Joe White in Detroit; Editing by Jeffrey Benkoe and Matthew Lewis

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Future of Ottawa: Coffee with Francis Bueckert

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Francis Bueckert: When it comes to the current landscape of coffee-roasting companies and independent cafes in Ottawa, I think we are at a really interesting moment in time. There are more local roasters that are doing artisanal small-batch production—with more attention to the quality and origin of the beans.

With larger corporations such as Starbucks closing locations, it has opened a bit of space for local players to grow. We have been lucky to work with many folks in the coffee-roasting community, and we have found that there is a willingness to collaborate among different coffee roasters. For example, when Cloudforest started back in 2014, we were roasting our coffee at Happy Goat and it was the expertise of their head roaster Hans that helped me learn how to roast. Other companies such as Brown Bag Coffee have also lent a hand when we needed extra roasting capacity. There are others, such as Lulo, Mighty Valley Coffee, Bluebarn, The Artery, and Little Victories that are also part of the growing local coffee community. It’s small roasters like these who have shown me what a coffee community can look like, and that we can help to elevate each other, rather than being locked in competition.

If you care to make a prediction… What’s happening to the local café industry in 2021?

We believe that there is hope and that 2021 can be a big pivot year for small roasters and cafes.

This year will not be ideal from a business point of view. However, it could create a shift in people’s attitude toward where they get their coffee. We are holding out hope that people will support the roasters and cafes that are local to help them economically survive what is in all reality a very difficult time.

It all depends on where consumers decide to go this year. People are starting to recognize that supporting large corporations at this moment will be at the cost of the local roasters and cafes. There is the growing realization that a future where there is only Amazon, Walmart, and Starbucks would be pretty bleak. So we have an opportunity this year to support the kind of local businesses that we want to see thrive.

In your wildest dreams, what will the landscape for local coffee roasters and cafés look like in your lifetime?

In my wildest dreams, all of the coffee roasters and cafés would be locally owned and independent. They would all be focused on direct trade and artisanal coffee. Each different coffee roaster and café would know exactly where their coffee came from. Ideally, each company would be a partnership between the farmers who grow the beans and the people here selling them. There would be a focus on how to cooperate and collaborate with the farmers in the countries of origin to share the benefits around. We would all work together and share orders of cups, lids, and other packaging so that we could get better bulk pricing. In this way, we would make our local coffee community so efficient that the large corporate coffee companies wouldn’t even be able to compete.

We would also like to see people use coffee as a way to create social good. For example, we started Cloudforest as a way of helping support farmers in Ecuador who were taking a stand against large mining companies. This remote community stood up to protect their environment, so that they could have clean drinking water and soil for the next generation. They started an organic coffee cooperative to help show that there are other models of development, and we are doing our part year after year to help support their vision. They have a vision of development that does not include mass deforestation and contamination, and organic coffee is a key (among others) to show that another way forward is possible.

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Special events in the Ottawa Valley dominate annual OVTA tourism awards

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The Ottawa Valley Tourist Association hopes that its annual tourism awards will provide a little sunshine during what is a dark time for local tourism operators because of the pandemic.

The Ottawa Valley Tourism Awards are presented annually by the Ottawa Valley Tourist Association (OVTA) to individuals, businesses, and events that recognize the importance of working together for the growth of the local tourism industry, as well as offering exceptional visitor experiences.

“After a year that saw a lot of businesses in the hospitality and tourism industry being challenged like never before, the annual Ottawa Valley Tourism Awards represent a bit of light on the horizon” said Chris Hinsperger, co-owner of the Bonnechere Caves.

The Ottawa Valley Tourist Association’s (OVTA) Awards Committee co-chairpersons, Meghan James and Chris Hinsperger, said they were very pleased with the recent nominations received, especially in the Special Events category. Submissions were received for The Farm to Fork Dinner Series at the Whitewater Inn; Light up the Valley; The Eganville Curling Clubs’ Rock the Rings; The Ontario Festival of Small Halls ; The Bonnechere Caves On-line Underground Concert Series; The Opeongo Nordic Ski Clubs’ Ski Loppet; The Tour de Bonnechere — Ghost de Tour 2020; and The Bonnechere Caves Rock ‘n Roll Parking Lot Picnic.

“During a time when communities were challenged, it is nice to see that people still made an effort to get together and celebrate, albeit under certain conditions. It just shows the creativity and resiliency of our tourism Community here in the valley” said Meghan James, director of sales at the Pembroke Best Western.

There are three Award categories: The Marilyn Alexander Tourism Champion Award, The Business of Distinction and The Special Event of the Year.

Hinsperger, is excited about this year’s awards.

“During this pandemic the hospitality and tourism industry was the first to be hit, was the hardest hit and will be the last of our industries to fully recover. As Valley entrepreneurs we owe it to ourselves, to our businesses and to our communities to be an active part of that recovery. Our livelihood and economic recovery depends on our efforts. And we will get back to welcoming people from all over the world to share a little bit of the place we are privileged to call home. This awards process leaves myself and others fully optimistic about our positive outcomes.”

Award winners will be announced at the Ottawa Valley Tourist Association’s virtual annual general meeting on Monday, May 31.

The OVTA is the destination marketing organization for the Upper Ottawa Valley and proudly represents more than 200 tourism businesses, comprised of attractions and outfitters, accommodation, food, beverage and retail establishments, artists and galleries, municipalities, as well as media and industry suppliers. The OVTA is supported by the County of Renfrew, Renfrew County municipalities and the City of Pembroke.

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Future of Ottawa: Farming with Jeremy Colbeck

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Jeremy Colbeck: Well first, let’s talk about what we mean by farming. Although farms, and farming as an occupation, are in decline across Canada, they are still a major part of our rural landscape. That’s even more true for a strange city like Ottawa which includes a LOT of rural areas and whose urban boundary takes, what, three hours to cross? About 40 per cent of the rural land in Ottawa is farmland. Most of that farming is corn and soybean cash-crop, as well as some dairy and livestock farming. That’s mostly conventional farming (the kind that is profitable but not exactly where you take your kids on a Saturday).

There are also a lot of agri-tourism businesses in Ottawa, which give you that oh-so-good Saturday spot for family donkey-petting and apple-picking. And it’s totally understandable from a business perspective, but sometimes surprising to find out, that even though they grow some of the Christmas trees they sell, they might also be reselling some that come from much larger farms far away. The farmland around Ottawa is also inflated in price because of its proximity to the city, where it is in demand by would-be hobby farmers—folks who want to do some farming on their property in their spare time but make their money (to subsidize their small-scale farming habit) elsewhere. Unfortunately, many of these properties will have large mansions built on them, which will then make them completely unaffordable for the average farmer

There’s also a segment of small-to-medium-sized Ottawa farms that grow “premium” (artisanal, unique, extra-fresh, ecologically- or organically-grown etc…) products that they sell directly to local eaters via farmers’ markets or other direct marketing channels, including on-farm stores and farm stands. That’s where BeetBox fits in.

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