Proceedings of the Standing Senate Committee on
Transport and Communications
Issue No. 19 - Evidence - June 7, 2017
OTTAWA, Wednesday, June 7, 2017
The Standing Senate Committee on Transport and Communications met this day at 6:45 p.m., to continue its study on the regulatory and technical issues related to the deployment of connected and automated vehicles.
Senator Dennis Dawson (Chair) in the chair.
[Translation]
The Chair: Senators, I call this meeting of the Standing Senate Committee on Transport and Communications to order. This evening, the committee is continuing its study on connected and automated vehicles.
[English]
I am pleased to introduce our panel of witnesses. From the Canadian Vehicle Manufacturers' Association we have Mark Nantais, President; and from General Motors we have Harry Lightsey, Executive Director for Emerging Technologies Policy; and David Paterson, Vice President for Corporate and Environmental Affairs.
[Translation]
Thank you for joining us. I invite Mr. Nantais to begin his presentation. Then the floor will go to the representatives from General Motors. Go ahead, Mr. Nantais.
[English]
Mark A. Nantais, President, Canadian Vehicle Manufacturers' Association: Thank you very much, Mr. Chair, and good evening, honourable senators.
I would thank you for this opportunity to speak to you about a timely subject, which is connected and automated vehicles. I represent Fiat Chrysler, Ford and General Motors, and we have representatives from General Motors, as you point out, with me this evening. Collectively these companies account for roughly 60 per cent of all Canadian production.
I want to talk about the unprecedented pace at which vehicle technology is moving forward in this area. CVMA members have been and remain committed to developing advanced driver assist technologies to reduce crashes, injuries and fatalities for occupants and pedestrians. The ongoing research, development and deployment of connected and automated vehicle technologies has the potential for additional societal benefits not just in enhanced safety, but also in terms of reducing greenhouse gas emissions and improved public mobility and productivity.
The rapidly evolving technology landscape will require government engagement, and specifically Transport Canada's leadership, to facilitate deployment and public acceptance of these technologies through coordinated approaches with the provinces and harmonized regulatory approaches with the United States' federal regulators. We are an integrated industry and operate with an integrated economy on a North American basis.
Ongoing dialogue and flexible approaches will be needed as the technologies continue to develop. Transport Canada started down this path in 2014 by passing changes to the Motor Vehicle Safety Act that allow exemptions from standards for new technologies where it's justified and make the act more nimble to align regulations with rapidly developing industry and U.S. requirements.
It is critical to avoid barriers that may inhibit the testing and deployment of connected and automated vehicle technologies. This includes avoiding premature requirements, misaligned requirements and a patchwork of requirements. We need the government to coordinate activities nationally across the Canadian jurisdictions and to work collaboratively with the United States on aligned requirements and the approaches of which I speak. This will provide the needed certainty in the regulatory landscape allowing vehicle manufacturers to focus on developing and deploying those technologies faster to the North American market in a safe manner with more choice and lower cost to consumers.
One such example is ISED's ongoing work to retain the 5.9 gigahertz band for vehicle Dedicated Short-range Communications in Canada and the U.S. to facilitate vehicle-to-vehicle and vehicle-to-infrastructure technologies.
Data privacy is priority to both industry and the consumer. As connected and automated vehicle technologies develop and are deployed, CVMA members will continue to comply with the comprehensive Canadian federal and provincial privacy laws that are in place to safeguard consumer personal information. Federally this includes PIPEDA and the CASL legislation, and data protection and data privacy are embedded from the very earliest stages of product development in our industry.
Of critical importance is cybersecurity. This is integral to the deployment of connected and automated vehicles, and automakers are taking proactive steps to identify and address issues quickly. CVMA members implement security features in every stage of vehicle design and manufacturing. They have a long history of partnering with public and private research groups, and they participate in forums on these emerging issues.
An Automotive Information Sharing and Analysis Center was created in July 2015 to identify and share information on potential cyberthreats as part of industry's ongoing efforts to safeguard electronic systems and networks.
As development and implementation of connected and automated vehicles continues, there will be many areas that will require further discussion and consideration.
I will end there, Mr. Chair, by reinforcing the commitment of CVMA members to the safety and privacy of Canadians as these technologies continue to develop, and our commitment to constructive dialogue with the government on these technologies, and also in terms of the supporting policies that go with it.
Mr. Chair, I would be glad to answer any questions senators may have.
The Chair: Thank you very much. We will hear from Mr. Paterson and then we'll give senators an opportunity to ask questions. Mr. Paterson.
David Paterson, Vice President, Corporate and Environmental Affairs, General Motors of Canada Company: Thank you, Mr. Chair. To the members of the committee, on behalf of General Motors, thanks for having us here today. I'm joined, as mentioned, by my colleague Harry Lightsey from General Motors' public policy team in the United States.
Today the auto sector is in a period of rapid technological change and transformation. At GM, we see the future of mobility as increasingly electric, highly connected, autonomous and a vital part of the sharing economy. We intend to lead our industry in these areas, and we believe that Canada has the potential to play a very significant part in this global wave of innovation.
Now, last year General Motors announced a three-fold expansion of our Canadian-based R&D and engineering work to 1,000 positions, with a mandate focused upon active safety control systems, infotainment and software development for GM's new autonomous vehicles. Related to that, we have accelerated engagement with universities across Canada — in Quebec, Ontario, British Columbia and elsewhere — and with more than 500 local Canadian technology start-up or scale-up companies. In addition to our new manufacturing investments in Oshawa, St. Catharines and Ingersoll, our new technology ecosystem is expanding in Oshawa, Markham, Kitchener-Waterloo, Kapuskasing and next in downtown Toronto.
With that background, we'll focus our remarks on policy development.
The committee has heard that self-driving car technologies have the potential to significantly improve the safety, environmental and accessibility impacts of transportation, with improved mobility for the disabled, elderly and other underserved communities. You have heard that there is a tremendous opportunity for jobs in economic development as well, and we certainly agree.
Our message today is that reaping these benefits in Canada will require a significant degree of coordination with the industry across Canadian jurisdictions and especially between Canada and the United States, with whom we have aligned our automotive regulations and standards. Policy must enable and not hamper innovation while protecting public safety.
First let me talk briefly about where we are today and how that is helping lead us to tomorrow. Connected vehicles with new advanced safety systems, like lane departure warnings or automated braking, are on the road today and they serve as an important technological pathway to fully self-driving cars. Our new Cadillac CTS, for example, is the first model in Canada with vehicle-to-vehicle and vehicle-to-infrastructure capability, using the 5.9 gigahertz spectrum.
Through our OnStar system, GM has been a connected car to the mobile network safety pioneer for over 20 years, providing customers with safety protection while ensuring full compliance with all Canadian privacy requirements. We believe new connected vehicle safety systems can be well managed under current laws and regulations, and Canada has an excellent reputation in this regard.
The next stage in automotive development will be self-driving cars. As you will see in the video that we've provided to you through the clerk, self-driving car technologies are rapidly advancing. General Motors has more than 70 Chevrolet Volt electric self-driving cars on the road today, and the videos take you through the streets of San Francisco in the daytime and at nighttime as well.
We believe that commercial development of these vehicles will first be in public fleets, such as taxis, delivery or ride- sharing formats. Doing so will enable broad public utilization of these vehicles, allowing individuals from all walks of life to access the technology.
Last September in the United States, NHTSA issued draft regulatory guidance for self-driving cars, including guidance on important related issues such as cybersecurity, which Mark mentioned. GM welcomes this and we are providing our input. We understand that Transport Canada is planning similar guidance on a harmonized basis. This is smart because it will enable alignment of on-road regulations of our states and provinces.
At General Motors, we believe safety must be the cornerstone of the regulatory approach to AVs. From that foundation, here are some key elements for regulatory framework for self-driving vehicles.
First, we believe legislation and regulations for vehicles equipped with automated driving systems should be focused on the higher levels of automation as defined by the SAE, mainly levels 4 and 5. Levels 1 to 3 are appropriately covered in current legislation.
Second, self-driving cars must, of course, comply with all vehicle and traffic laws. Our laws, however, need to be updated to account for driverless technology.
Third, with autonomous vehicles, incident records should be maintained and an event data recorder required to compile data in the event of any accident.
Insurance is often a question, and we believe the operators should be liable for deployments,as set out under provincial or state laws, with the caveat that they should be protected against liability for unauthorized vehicle modifications.
Provincial and state regulations should expressly authorize the establishment of on-demand automated vehicle networks, or ride-sharing services, and self-driving car fleets or project parameters, such as the geographic area, should be defined by the operator.
In summary, this is an incredibly exciting period of technological change. Our approach in Canada to the deployment of self-driving technology must be founded on safety first, with strong ongoing engagement, collaboration and harmonization as essential guideposts to optimize the tremendous benefits of this technology on the road ahead. Thank you.
The Chair: Thank you, Mr. Paterson.
Senator Bovey: Thank you for coming. You talk about safety, and we have been hearing about testing. I know there are many people in the game, so my questions are twofold.
First, you've just talked about sharing instances and sharing economy. I'd like you to talk a bit about what you mean by sharing, to make sure that everybody is up to speed with what's working and what's not.
I'd also be interested to know a bit more about — you've given some regulatory suggestions. I'd like to know about some of the policy areas. Who should drive those policy areas? Which ones should be driven by the manufacturers? Which ones should be driven by regulators? Which ones should be driven by the federal government or which level of government to make sure we can drive across the border, as well as being able to drive across our provincial boundaries?
Mr. Paterson: I will start with sharing. Harry and I will both jump in on that.
Two things come to mind with regard to sharing. I mentioned the sharing economy. We think of companies like Airbnb and others, and we really believe that, especially in urban areas, this will be an incredibly important aspect of how people will access mobility.
It may sound funny to hear from an automaker, but we are actually starting a business within our own business to be able to provide people with mobility service, not just sell vehicles. While we, of course, want to continue selling vehicles at General Motors, we also accept that many of our customers might not own a car. In fact, we acknowledge that if you have a car, it may sit in your driveway for a high percentage of its time and maybe that's not the best utilization of the resource. There is also someone like my daughter, who wants to get around downtown Toronto, and probably thinks of transportation as something she calls up first on her smartphone rather than thinking about a car.
We have developed within General Motors a company called Maven, which effectively provides ride-sharing capability to people in a number of different ways. Number one, if you lived in a condominium and you were in a busy downtown place, you might join a gym club. Equally, you can have a Maven app, we will have a fleet of General Motors vehicles in the condominium and you can just book time on those vehicles. You don't need a car in the city, but you might need to book a certain car to do grocery shopping and a different vehicle to go away on the weekend. We give them that option.
Another form of Maven's service, for example, is to provide vehicles to ride-sharing companies. Sometimes their biggest gap is to be able to have drivers, and the drivers don't have vehicles, so we set up to be able to provide them with that.
Third, we also compete in a market where people will see vehicles available within their living areas and, through an app on a phone again, they can be able to not only book a car, but through our technology they can open the door, start the car and have a vehicle ride through that process. That's very much part of our business model going forward.
That's an element of sharing. Other aspects of sharing probably have to do with sharing of data and information, so we'd be happy to talk about that as well.
Mr. Nantais: Maybe I can respond, too. Just on the issue of regulatory and policy areas — the who, how, what and when perhaps, who should lead — we have been working with Transport Canada for many years on the alignment of regulations on a North American basis. Why? Because harmonization of regulations not only takes us to a higher level of a common denominator, vis-à-vis safety standards and so forth, but we're highly integrated on an economic basis and on an industry basis, as we've mentioned.
We've been working with Transport Canada. They have done a very good job at removing differences and misalignments of regulations. Part of that work to date also includes connected vehicles, vehicle-to-vehicle and vehicle- to-infrastructure. That was also part of the work plan to the Regulatory Cooperation Council and that's definitely one the things still outstanding. We would like to see that work pursued further, particularly as we move forward under the new U.S. administration.
The key thing here is Transport Canada should be providing the directional vision on behalf of the country vis-à-vis these regulations and policies. Let's start with policies or guidelines. We do not want to be overly constraining in terms of innovation and flexibility needed to bring these things forward. But ultimately the directional vision is one thing, working with the province is the other, provinces themselves working with municipalities when we talk about infrastructure and so forth. So these things are multifaceted and very multidimensional.
Transport Canada is working with the Canadian Council of Motor Transport Administrators. That organization is also working with their counterpart organization in the United States. It's about turning every ship in the fleet in the same direction, pointed to the same distant point on the horizon, so to speak, and moving in one direction in unison. That will be necessary.
Senator Bovey: You feel that's happening?
Mr. Paterson: I think we have started down that path in a fairly constructive and effective way. There are many more issues that you've heard about in various other testimonies that suggest that there are many more issues to deal with, and that is indeed the case. We will have to look at those as we go.
I think we are up and running on this. The idea is to make sure that we coordinate with the United States primarily.
That's just on light-duty as well as heavy-duty vehicles. Commercial vehicles moving back and forth across the border must be seamless, and we are moving in those directions. Many transport trucks, for instance, in our industry in particular, are already vehicle-to-infrastructure connected. That's critical as we go forward.
Harry Lightsey, Executive Director, Emerging Technologies Policy, General Motors of Canada Company: David covered our efforts in the ride-sharing world, and we certainly do believe that the early horizon for seeing these vehicles in the public domain is in ride-sharing fleets mainly in city centres for a variety of reasons.
I just would reiterate that in terms of the automobile industry, we are seeing an almost unprecedented wave of technological change. Our CEO Mary Barra has said she expects to see more change in the automobile industry in the next five years than we've seen in the last 50 years. We believe that.
What we're also seeing is new entrants into our industry for the first time. We're seeing companies that aren't traditionally associated with the automobile industry, like Google and Apple, that are all acting in the space. That is leading to tremendous innovation, which we are very excited about and, frankly, welcome.
One of the things we have to be very careful about is to make sure that whatever we do, we allow the proper framework and the proper room for all companies who want to innovate and participate in this new technology to be able to do so.
With regard to data sharing, that's something that is mentioned very prominently in the federal automated vehicle policy guidance issued by NTSA in 2016 that David referred to. We are in the very early stages of that, because we are in a space now where companies are innovating at a very fast pace, and a wide variety of companies as I mentioned before. Frankly, protection of intellectual property in this competitive area is very important to all of these companies.
We are just at the very beginning of coming together and trying to figure out what the right kinds and ways to share data in a way that doesn't compromise anybody's intellectual property or give them an unfair competitive advantage.
Senator Runciman: I'm glad you've focused on the question of government's role and the regulatory role going forward. To some this may be unfair. Mr. Nantais will correct me if it is, but in terms of government's role, I understood it as boiling it down to don't get in the way and that's a sentiment I can normally share.
Mr. Nantais: That's a good way to say it I suppose.
Senator Runciman: But I do have some concerns with respect to going forward in this area. I have raised this at a number of our meetings, this whole issue of trust in the industry itself and are you doing the right things or are decisions sometimes being taken that are perhaps in the best interests of shareholders and not the public.
We have a number of examples of that we have seen over the past few years: Volkswagen; recent claims with respect to Hyundai; and General Motors has had its problems. There are at least five major manufacturers who have run into these difficulties.
You said from one to three, I think, Mr. Paterson. What are you doing with the new technologies today that are going into the cars you are producing? My focus on the regulatory side is really focusing on the privacy and security safeguards. We say that technology is advancing very quickly. We understand that, but are you keeping pace with ensuring those safeguards are in place?
I ask that question, and Mr. Lightsey may be more familiar with the study than the other two witnesses. This is the study from U.S. Senator Edward Markey. I don't know if you are familiar with the study produced a year and a half ago. Some of those conclusions were concerning, to say the least. Most cars on the market are vulnerable to hacking; automakers do not have records on hacking; only two manufacturers have the ability to diagnose or respond to a hacking incident in real time; very little awareness of customers of privacy they are surrendering when they get into one of the products. Could you speak to those issues for us?
Mr. Lightsey: First of all as David has mentioned, safety is certainly our top priority in this area. But more so than that, in this new world that we're entering, customer trust is paramount. If the customer doesn't trust that when they get into the vehicle they can reliably get in and safely get from point A to point B, then all of the investment and effort that we've expended to develop the technology is going to go away with our ability to do that.
I think customer trust is the critical issue that we all must face. The customers have to be able to trust the technology and know that when they get into the car, it's going to deliver them safely to where they want to go. That's the key. We all understand that. Frankly that is very important, not only with regard to self-driving vehicles, but with regard to all of these new connected and safe crash avoidance technologies that we are putting into our vehicles. The customer has to trust that those technologies will work in order for us to take advantage of the technology and to reap the benefit of the safety potential of saving thousands and thousands of lives.
Speaking on behalf of General Motors, we've expended substantial efforts and taken organizational moves to be as strong as we can possibly be in these areas. We have a chief privacy officer. We have published our privacy principles that were adopted by our board of directors in 2009. We benchmark our privacy practices against all other companies. We strive to be current and at the best in terms of our privacy practices with regard to our customers.
We subscribe to the automobile industry privacy principles, which the automobile industry agreed to in 2014. It is one of the few industries that has voluntarily adopted a set of privacy practices, so the automobile industry as a whole is dealing with the issue in a proactive way.
On the issue of cybersecurity, we have an organization within GM. We have a chief product cybersecurity officer and he and his organization do nothing but focus on cybersecurity, 365 days a year, 24 hours a day. They now have a robust organization that tests all of our systems and they have final approval. There is no vehicle or any system or service that goes out to the public domain unless our cybersecurity organization signs off on it.
We belong to the Auto-ISAC that Mr. Nantais referenced. We also benchmark against companies in the defence industry and the aerospace industry with regard to their cybersecurity practices to make sure that we are keeping abreast of what is the cutting edge, in terms of what we can do to make our cars as difficult as it possibly can be to hack into. We take a number of steps to protect the safety of our customers in our vehicles.
[Translation]
Senator Boisvenu: Thank you for coming to our committee and for the little video you sent to us.
For several months, we have been asking ourselves a lot of questions about the changes that will have to be made to our transportation infrastructure. When I watched your video, I noticed that the automated vehicles operate on regular infrastructure. So I told myself that, basically, no investments will need to be made along those lines, because the vehicles will be able to travel on current roads.
When I was a teenager, we used to buy little racing cars that moved along a rail in the middle. I told myself that the autonomous vehicle concept would be much the same, because sensors in the road would guide the vehicles along. If I understand correctly, the car uses its own sensors to drive itself.
Is my understanding correct? I was convinced that there was going to be a major challenge in terms of the infrastructure, but, as I watch your video, I see that we are not going to have to rebuild our roads for the next 10 or 30 years.
[English]
Mr. Paterson: The vehicles we demonstrated in the video that we shared with you are, in fact, going from point A to point B through San Francisco, which is a very challenging environment both day and night. We're looking at this technology as a series of additional redundancies to ensure maximum safety as we go forward.
One of the things you've heard in some of the earlier testimony has to do with vehicle-to-vehicle and vehicle-to- infrastructure spectrum in Canada. The individuals at ISAC did a great job as we started to move some of the first vehicles — it happened to be a Cadillac coming into Canada that had this technology — to ensure that we reserved that spectrum for this type of short communication span.
This is an additional aspect so that a vehicle will be able to see 12 vehicles ahead, find out what experience they're having with the road and the environment, and send a signal to a vehicle farther back to give them additional assistance to be able to drive properly.
Similarly, and over time, one of the great things that government infrastructure can be a part of is to have a coordinated system so that there is conversation between the vehicles and traffic lights, conversation between the road signs that give us direction on our highways, et cetera.
Recently, we had a study done for the industry by the Center for Automotive Research and they were looking at predicting when certain technologies would come forward. They expect probably 2040 to be the time when 70 per cent of the stop signs or the traffic lights in North America would be able to speak to the vehicles around them.
Senator Boisvenu: Would be intelligent.
Mr. Paterson: If we're going to bring these vehicles on to roads quickly, we need sufficient systems of lidar, radar and all the things in the car to navigate any particular circumstance, without the dependency on the infrastructure. But as the infrastructure comes forward, it will make it safer and more efficient going forward. That's where we'll need to work together.
[Translation]
Senator Boisvenu: My second question follows up on Senator Runciman's.
With information technology or in the automotive industry, trade secrets and protecting information are very important. It is a highly competitive area.
When we are dealing with an industry that tends to keep information to itself, because it is in competition with other sectors, other industries, how do governments, whether federal, provincial or municipal, play a leadership role, knowing that the information it will receive from companies will also be limited?
[English]
Mr. Paterson: One of the examples to further some of the discussion about cybersecurity, for example, is it's very important that we do share information. Our approach to cybersecurity, through the ISAC process, co-chaired by our chief product cybersecurity officer Jeff Massimilla, is to make sure that just as we do in other industries — in defence and other areas, nuclear, et cetera — that when there are cyber attacks, we share information and learn about this as we go forward. Our systems are founded on that going forward.
There are some areas, just as we do with safety in our plants, where there is no competitive advantage. We want the industry to be safe. It's the same thing in cybersecurity. It's very important that we have these systems to share information and that's what the ISAC is about.
I think it was about eight months ago that I brought Jeff to Ottawa and we met with most senior deputy ministers across the government, and also with the Canadian Privacy Commissioner, to explain how we do cybersecurity, how we do it as an industry, how we share information and to answer the questions. I think the best thing we can do is to continue those conversations.
Senator Galvez: Thank you very much for this interesting conversation that we have been having for more than a couple of months.
First of all, I want to comment that your industry is so homogeneous. You are coming here from different companies and industries and making the same speech, with the same development plan. I don't know if you're talking or not talking, but you're going the same way, and that's very evident. So, we are running out of questions.
I am curious about some things and it is the fact that the more I hear you, I don't hear a mechanical company any more, but a computer company. My brothers are civil and mechanical engineers and we have these big discussions on mechanics. My brother who is a mechanical engineer is both mechanical and electronic, so he is assuring the interface between the mechanics and the electronics for airplanes. The way they work for safety is that they control the software, and the mechanics don't move anymore. It's like the mechanics are fixed.
One of my questions is: Are we saying that the car as we know it — the mechanical part — is not going to evolve anymore? Have we reached the top of the mechanical thing and now we're just going to need upgrades to the software? That's one of my questions.
If it's that, then I can see the advantages of mobility services. If you go in that direction, then there are a lot of things that you don't worry about anymore, like upgrading the software for a person that bought this car and the software went bad and it requires upgrading. By you controlling the mobility service, you will do all the upgrading, and you will be in control of all the communications — vehicle to infrastructure, vehicle to GPS, and to Internet.
If we go in that direction, are cars going to be in the same shape when we reach full automation? Are they going to look like cars or something else?
Mr. Lightsey: I will say, and David mentioned this in his statement, there is rapid change going on in the mechanical areas of the automobile as well. Electrification is a movement. If you think about an industry that has for 100 years been built on the gasoline-combustion engine, today we have battery electric vehicles, hydrogen fuel-cell vehicles — a number of different types of things, including the kinds of materials going into vehicles, using lightweight metals and different techniques of putting those metals together. Those are really incredible technological feats in and of themselves. The mechanical aspects of the vehicle continue and will continue to evolve.
On the other side, we're going to see vehicles that are owned individually for a long time to come. Those will continue to evolve as well. It's part of our job to design these vehicles so we are able to keep the software up to date, so that the vehicles can be safe and keep them protected from folks that want to try to hack into the vehicles and that kind of thing. That's very important as well.
We're going to have to do the new things and continue to do the old things better and better.
Senator Galvez: I asked my question in this form because when you talk about the legislation for cars, it mostly touches the mechanical aspects or the environmental aspects. Will the new legislation have to touch the electronics and the software? For us, it means a big difference.
Mr. Lightsey: Absolutely. That's one of the things, and David alluded to it. Both in the United States and in Canada, most of our regulations and laws are built around the idea that there's going to be a person behind the wheel driving the car. Going forward, we can't assume that's going to be the case. We're going to have to develop policies, laws and regulations to deal with the circumstances of when there isn't a person behind the wheel. We know that, and we want to engage with the policy makers to figure out how we do that going forward.
Where we are at right now is the very beginning. We have a test fleet of cars, as mentioned, and we envision growing that test fleet and putting them into service in ride-sharing services within controlled contexts and working with policy makers to understand what the issues are. Today, we really don't what the issues are. We can't envision what the issues are.
What we're talking about here is taking the first steps of getting these vehicles on the road. It took us 100 years to get where we are today with regard to the conventional vehicle, and we think that policy makers will be busy with the new technology and the new vehicles for the next 100 years.
Senator Griffin: I have a fairly quick question. I have two brothers who are mechanics in a small shop. What happens to these people who are in the after-market, as vehicles get more dependent on data? How do you propose that you would share data with the mom-and-pop operations, as well as the bigger operations like Canadian Tire?
Mr. Nantais: This is something that has come forward as an issue, not just in this space, but even prior to it with current vehicles, for instance. We have agreements with the after-market industry to share information on repairs, training and equipment.
When we get into this area, primarily dominated by software, this could be a very different time. Lines of code and so forth are proprietary and probably would be off-limits to the after-market — and anybody else for that matter. This would be owned by specific companies. The after-market industry and the service repair industry are going to probably have to adapt as well.
Mom-and-pop shops have been struggling for some time to keep up with the technology advancements in the industry, and this will continue.
I don't mean this in an overly negative way, but one has to advance with the technology. That will be the case for the after-market industry as well. If the expectation is to share proprietary information and intellectual properties related to that, that's not going to happen.
Mr. Lightsey: As referenced by Mr. Nantais, we have current agreements in place with the after-market industry, and we do make tools available to them so they can service our vehicles, as well as at our authorized dealerships. That practice will continue for the foreseeable future.
It is important, to reflect what Mr. Nantais was saying, that we understand that with regard to some aspects of the software itself, for cybersecurity reasons, we have to control the software. We cannot allow third parties to have access to the software, because it might get to some bad guys and then we would all be in trouble. There are cybersecurity aspects to this as well.
Senator Griffin: Sure. Thank you.
[Translation]
Senator Saint-Germain: I am interested in the macroeconomic impact of autonomous vehicles. I will not ask you to share your company's secrets or financial planning details, but, in the broad sense, if everything goes well, let me hypothesize that you are going to turn the current market for automobiles on its head. From that perspective, the public and mass transportation market is going to dominate, because, basically, there will be fewer vehicles on the roads.
Could you tell me whether you have data or metrics on the economic impact for governments, public carriers and vehicle manufacturers in the areas of mechanics and telecommunications? Also, have you previously been, or will you in the future be involved in all that by merging with those telecommunications companies? Basically, what macroeconomic impact do you eventually foresee?
[English]
Mr. Paterson: We see tremendous opportunity in this change and, as I mentioned earlier, even though we are building part of General Motors' business as part of the car-sharing business, we intend to continue manufacturing and providing vehicles. We'd like to do that in Canada.
We expect a lot of our individual consumers, as Harry mentioned, living perhaps more in rural areas or commuters, will need to own their own vehicles, and they'll love driving their vehicles. I intend to drive my vehicle because I love driving.
We see excellent opportunities in terms of the business models going forward to be able to provide mobility as a service to our customers, and really we take a customer-centric approach to this. If you are living in a city, what is the best way for the environment, for you and your pocketbook, and for your convenience, for the space we take up with parking garages, the ability to move around town, and the number of vehicles on the road — all these will be impacted by change. However, this is not a change that will take place in 2 years or 5 years; this is a change that will take place over 20 or 30 years going forward.
[Translation]
Senator Saint-Germain: That is why I am asking what the general impact will be eventually.
[English]
Mr. Paterson: I would say that our company is perhaps a good example of that in that we are hiring to a base of 1,000 engineers in Canada right now to take advantage of some of the incredible skill base that we have. As was mentioned earlier, Montreal is a hotbed for artificial intelligence. So is Toronto. British Columbia has some amazing aspects.
We have actually spent full days with the engineering departments in over a dozen universities across Canada in the last several months to understand what opportunities we have. One of the reasons we are working with 5,000 different start-up companies, that we're interfacing with, is that Canada has great potential in this new type of industry to be a part of it.
If you think of it, companies like BlackBerry and others in Canada in the telecommunications industry are world leaders in cybersecurity and in mobile telecommunications, and we have embedded a lot of that skill.
As technology progresses, there will be change and governments have to struggle with those changes and we will be part of that. We want to continue providing excellent manufacturing jobs, but we have opportunity in these new technology areas, with the right training and the right education system, which thankfully is a great strength here in Canada, to grow.
It's no accident that General Motors is hiring 1,000 engineers. That's a wonderful opportunity. If we can build on that as this technology progresses, that could be great for Canada.
[Translation]
Senator Saint-Germain: Currently, municipalities are responsible for public transportation in their own territory. What could be the impact on municipalities in terms of public transportation? Could there be a paradigm shift from individual transportation to mass transportation?
[English]
Mr. Paterson: One of the things that we are working with great focus on is multimodal transportation. So, for example, General Motors in Canada is developing an e-bike right now. Why? Because it's part of a solution for people in cities to be able to get from A to B. Maybe getting on a bike, an electric-assisted bike, from the metro station to your office will be part of that solution.
We are thinking well beyond our traditional business model to thinking of transportation as a service going forward, and that will be one of the most rapid changes. For municipal providers of those services, they are wise to also think of how they are being disrupted by new services coming forward, ride-sharing services and the like, and look at it as an opportunity for their customer.
What we're doing, whether it's a person paying for a bus or riding the metro, we are looking at ways to get them from A to B at an affordable rate — affordable for government and affordable for business. We see great opportunity in making that more efficient.
I would love to get up in the morning with an app that tells me that the best way to get downtown is a mixture of a ride share, a subway and a train, and I might be willing to do that because it gets me there five minutes more quickly than just riding a regular vehicle. In places like Toronto, it probably would.
Senator Eggleton: It sounds like you're going into the service business.
Thank you for your presentations. I want to pick up on a comment made earlier by Mr. Lightsey about a driverless vehicle, which I take it is where we get to on a level 5 automation or perhaps to some extent a level 4 automation.
I know that all of the information you're giving and other people are giving is that we will have safer roads as a result of fully automated vehicles, fully autonomous vehicles, but if something goes wrong for one reason or another, with the software, with whatever, and the vehicle without the driver creates an accident, who is liable for that?
Mr. Lightsey: Our perspective is today we feel that the liability can be dealt with under current law. Today we are responsible for the performance of our vehicles and the performance of the systems on our vehicles, and we understand that and stand behind our vehicles and would do the same for the self-driving vehicles.
If you had a crash that was the result of something being wrong with the vehicle itself, then obviously that's something that we would stand behind and be responsible for. On the other hand, if the crash was caused by another vehicle or human error, then that would be something that they would need to be responsible for.
Senator Eggleton: We're used to airplanes that have automatic pilot, but we also have somebody in the cockpit all the time. Where does that separate? Does that separate at level 3? Is that notion similar at a level 3 whereas when you get into level 4 or level 5 you are going steps beyond that?
Mr. Lightsey: For us, the distinction is that level 3 and below envision a human being in the equation at some point in time. With regard to levels 4 and 5, the vehicles are responsible entirely themselves. If something goes wrong, the vehicle is itself responsible for getting the occupants of the vehicle and the vehicle itself to what they call a minimal risk condition, or to a safe stop, frankly. That's the distinction, yes.
Senator Eggleton: How long before we will see level 4 or level 5 on the road?
Mr. Lightsey: We have level 4 vehicles on the road today. Our test fleet that David described are level 4 vehicles. They have a person behind the wheel.
Senator Eggleton: Yes, I noticed that.
Mr. Lightsey: We call them an AV trainer. They are there to take over if the vehicle reaches a point where it can't handle the situation it is in. But we envision at some point that these vehicles will be on the road without a person behind the wheel.
Importantly for us, our process will be informed by safety. Safety is our top priority, as we mentioned, and we're not going to take that step until we are fully confident that the vehicles will perform in a safe way and safer than in situations that we are in today with human drivers.
We right now have a person behind the wheel. Right now we only allow General Motors employees in the vehicles. At some point in time, we will begin to allow the public to be in the vehicles and to take rides in the vehicles. Eventually, at some point when we're fully confident and have the data to support that these vehicles are performing safer than they would if being driven by humans, then we envision removing the driver from the vehicles.
To pick up on one of the other senators' questions, once you remove the driver from the vehicle and begin to envision a car that doesn't need a steering wheel or brake pedal and all the different controls we have in there, then you start to see the possibilities for different-looking automobiles from what we have today.
Senator Eggleton: You also have to build public confidence to get into such a vehicle.
Mr. Lightsey: Absolutely.
Senator Eggleton: And, of course, you have to convince governments about the safety and security, which I think is the upshot of many of our questions.
[Translation]
Senator Cormier: You mentioned the leadership role that Transport Canada should play, in the context of federal, provincial and municipal considerations. What suggestions would you make to Transport Canada if you had to give them three or four strategic priorities, in order to get this transition started, so that municipalities and provinces are ready?
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Mr. Paterson: I mentioned some of this in my remarks. We have met with the Ontario Minister of Transportation to suggest what priorities we see at the provincial level in terms of preparing for not just testing — because Ontario is the one province, of course, that enables us to test under certain conditions — but also what a pathway toward deployment vehicles would be.
We actually have, we think, an incredible opportunity in Canada. Right now in about 35 states in the United States, we are seeing legislation — sometimes very different legislation — being introduced. There's a bit of a checkerboard taking place. We have an opportunity, if we align under some good model legislation, to do this in a way that is consistent.
Of course, the rules of the road are provincial jurisdiction, and then the rules of the vehicle are federal jurisdiction. We think Transport Canada is doing a good job, in our interface with them, with not only looking at what they need to develop, but how they can do it in a way that is aligned in North America so when these vehicles cross borders, that will work effectively. We already have, in certain legislation before you, new enabling powers that are required to be able to exempt vehicles being tested at the federal level. So that's good. We're taking the right steps.
The NHTSA guidance and what Transport Canada is developing are good. Those discussions are taking place.
At the provincial level, through the Ministers of Transportation, we have an opportunity to look at model legislation that might help the province. In my remarks I outlined some of the areas that might be thought about in terms of developing that legislation. We shared that with Ontario and through Ontario, which I think co-chairs the Ministers of Transportation, we will continue to have that discussion and answer questions on all the areas of cybersecurity, privacy, et cetera.
[Translation]
Senator Cormier: We are concerned — and we discussed the subject earlier in connection with other testimony — by the impact on training and human resources. In your company, how do you see all this workforce transformation?
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Mr. Paterson: Again, perhaps we are at the forefront of this in Canada in some ways, because we are actively searching for people to help us in the development of these systems. As mentioned before, maybe this industry is starting to look more like a technology industry than just purely a mechanical industry. We have selected Canada for doing a lot of this work because of the skills we see here.
We are already starting to get to the stage where we've done extremely well, but we need more. We are working with the universities, with select professors, to indicate what areas of skill we will be requiring so that we can bring those skills up. This is a job-creating opportunity, to start thinking about these skills in software development, but also in mechanical areas, where we can start preparing the workforce so that Canada can have more than its share of this type of work if we're successful.
The Chair: Before going to second round, you said you had hired 1,000 engineers. I come back to Senator Galvez's question about her brothers being electric and mechanical engineers. How many engineers are from the software world and how many from the mechanical?
Mr. Paterson: To be clear, we had a base about a year and a half ago of I'd say around 250 engineers largely in the mechanical area. We had some expertise in that. About 700 jobs that we are looking at are largely in the software area, and that's just because of the global mandate we have received at General Motors. All three of these areas I mentioned are dominated by software development. These are transferable skills to an extent, but then they come into our ecosystem and they move those skills up to a higher level.
Again, we can augment that by working with some of the best minds in our universities in areas like machine learning and artificial intelligence. We have some great expertise here and we are spending an awful lot of time with our Canadian universities, hoping to recruit people in that area.
Senator Runciman: I have a couple of things. We talked about privacy issues, and I think Mr. Nantais and others stressed complying with PIPEDA and current privacy laws.
With cars on the road today, I assume the majority of car owners are plugging in some kind of device and, as a result of a lot of that, personal data is being collected. What happens to that data today? What does the industry do with that?
Mr. Lightsey: Several things are triggered by your question. First of all, the customer needs to understand with regard to any service that they choose that involves the collection of data, what data is being collected. We have a commitment of transparency that we will tell the customer what data would be collected with regard to any service before they subscribe to it, and then we get their affirmative opt-in to that service. We would not begin to collect data for any customer until we had their consent to do so.
Now, once we begin to collect data, we only keep it for as long as is necessary to provide the customer the service that is being furnished to them. Once that data is done, then it's discarded.
For example, if you asked for directions from OnStar to get from somewhere here in downtown Ottawa to somewhere else, once you finished your trip, the data that gave you directions and followed your progress as you went on your trip would be discarded. If, for example, you asked for a service that collected data on your driving habits to get a report on a monthly basis, once that report was given to you, then the data would be discarded.
Senator Runciman: What security measures do you have in place to, if possible, preclude hacking? Because I can see situations where someone might want to know your driving patterns and your habits, where you go every morning and where you stop. What do you do to prevent that?
I go back to Senator Markey's report where he said that the industry, by and large, doesn't have the ability to recognize hacking, let alone respond to it.
Mr. Lightsey: I'll say two things. First of all, I'm very familiar with Senator Markey's report. As you indicated, the report is a year and a half old itself and it was based on information that was accumulated for a couple of years prior to that. In an era and time where we are changing very quickly, some of that information is somewhat dated.
As we went through, we have made huge efforts on the part of General Motors to make sure we make it as difficult as possible for anybody to get access to our customers' data or to the vehicle itself. That is critically important, frankly because of the relationship we have with our customers and the importance for us to keep our customers' trust.
Senator Runciman: So the data is never shared with a third party?
Mr. Lightsey: Not unless we have the customer's consent. For example, if we had a service that followed your driving habits, as we've described, it's possible that you may want us to give that information. If you are a very good driver, you may want us to give that information to your insurance provider so you get a lower insurance rate. If you instructed us to do that, then we would. Otherwise, we do not share our customers' data with any other third parties.
Senator Runciman: Mr. Lightsey, you were emphasizing driverless vehicles, and we are looking forward to that at some point in time. This is again dealing with security issues.
We heard about the hijacking of a Jeep in a test for Wired magazine. It shows the vulnerability. Given what we have seen recently and the use of vehicles in terrorist attacks, mowing down innocent people, I would suggest that the risk grows as vehicles become more autonomous and more connected.
Are there any specifics you can provide on what the industry is doing to respond to that kind of risk? For example, are you looking at override capabilities that could be shared with law enforcement? Is that sort of thing being looked at by industry that you are aware of?
Mr. Lightsey: First of all, I must make the distinction that the vehicles that were used in the recent terror attacks were not self-driving vehicles or connected vehicles even. The Jeep hack involved a vehicle was that was connected but not self-driving. In today's world, larger and larger numbers of vehicles are connected and so this is a critical issue not just for self-driving vehicles, but for generally all of our vehicles. Cybersecurity is a very important issue to us.
With regard to self-driving vehicles, as you indicated, it's even more important. We design defences in layers and in- depth, in the industry terminology. They make it as hard as they possibly can for you to get access to any of the systems in the vehicle, but if you get access to a system in one layer, then there is another layer of defence beneath that and one beneath that.
We try to isolate all of the safety-critical systems, so the steering, the brakes, the things that mechanically have to do with the control of the vehicle. We isolate all of those systems from the infotainment, the connected parts of the vehicle itself. Those are the kinds of things we do.
As I said, we benchmark against the aerospace industry and the defence industry. We talk to those industries to stay as current as we possibly can be in keeping our vehicles as safe as we possibly can.
Senator Beyak: Senator Runciman's question prompted a practical question. Last time I rented a car, there were four people's telephones still in there when I went to hook up my phone. Would their data automatically go away because their phone isn't in the car anymore? Or is it stored there? I'm just curious.
Mr. Paterson: If the car was sold through one of our dealerships, it would be cleaned. If the car was sold from individual to individual, then that individual making the sale of the vehicle has the responsibility. That's set out in our guidelines and terms and conditions that you would have a responsibility to do that. Certain cars do have that capability to be able to store that data, but if you are doing a personal sale and pushing it on, then there is nobody that's doing that for you per se.
Senator Galvez: I was wondering, because the cars are going to require a lot of batteries and electricity to sustain all of the services and the needs, and today cars there is multi-fuel; hydrogen, there is the battery, you will probably need to have fuelling and recharge stations in the city or on the highways.
Are these stations going to be paid, according to your vision, by your companies, the cities, the municipalities? Who will pay for those stations?
Mr. Nantais: That's a very good question. We talk about refuelling infrastructure or recharging infrastructure. We build vehicles. When we get into electric vehicles for instance, recharging is providing essentially the gasoline only in the form of electrons. This is something that is not our core business. Those companies who are active and obviously have produced products for recharging and refuelling are the ones that should be providing those pieces of equipment. This is a critical question as we go forward, the recharging infrastructure. This is something we talk about with the electric vehicle strategy for Canada.
Geographically Canada is large, with rural areas versus urban areas. Many areas of our country have no infrastructure whatsoever. So this is critical. Why would we buy a gasoline vehicle if there were no gasoline stations? Why buy an electric vehicle if there are no recharging stations?
We are working with governments, policymakers and the recharging industry on what can we do to ensure the pieces are in place to increase the demand for electric vehicles. This is part of our future, and the stringent standards we have to meet. That's one technology pathway. We have to ensure the infrastructure moves forward coincidentally with the vehicles, so the consumer has every confidence when they purchase an electric vehicle they can recharge that vehicle as and when they need it.
Senator Beyak: We live in a rural area. I wonder how much of your operations will be concentrating on the rural areas? President Trump took a lot of heat for his Paris climate change thing. In the hinterland there are 3,141 counties and he won 3,080 of them, so he had to listen to the people that still need fossil fuels. We have the North where people rely on fossil fuels to heat their homes and run their cars.
How much of your organization still worries about the hinterland and the country folks, as opposed to the LAs, the New Yorks, the Torontos and the Montreals?
Mr. Paterson: From the perspective of General Motors Canada, that's a big part of our constituency. We enjoy serving rural Canada. I would venture to say that the first thing you see when you drive into most small rural towns is a General Motors dealership of some form.
As technology changes, to take it back to the topic of the committee, as Mark mentioned, we need to think through how we can support with proper infrastructure, whether it's infrastructure for autonomous vehicles or electric vehicles. We are proud to be the biggest seller of electric vehicles in Canada. We have a number of rural users that are dependent on that, so we try to develop a battery that will go approximately 383 kilometres on range and that starts to give more accessibility to people who are not just in urban areas.
That's another example of how technology will continue to progress and change, but all of what we say gets founded in one thing and that's our customers. If we are not building for customers, then why are we doing this technology?
The Chair: I would like to thank Mr. Nantais, Mr. Lightsey and Mr. Paterson for their participation here today.
For our next meeting, Tuesday, we will hear from representatives from Ford, Carillon Information Security Inc. and CoinDesk.
(The committee adjourned.)