I remember back in the day where companies actually used their own money to build places, rather than the government begging to give them welfare cheques.
@@Alex-cw3rz When was this? Back when the corpos ran their own small towns and could expect the government to show up with the army when the residents rebelled? There was never a time when people with money didn't suckle on the state teet. Old south slavers invented police patrols to control their labor force. Silk road caravans needed Tang dynasty cavalry regiments to ward off bandits. The difference now is just that we're all supposed to accept this as good for the economy and thus ourselves.
Mining towns in Australia were generally built by one employer, and the success of the town was 100% reliant on the mine’s continued use. If the mine shut down, the town died.
@@MrEdHasibuan1996 company towns? The population here is 40,000 the jobs are 3,000. They wouldn't be a company town it would be a single suburb of a larger town that they payed for, which is what always used to happen. Look at Port Sunlight for example.
Hey Ben! As someone who enjoys your videos, I am proud of you for this amazing video! Does St. Thomas still have a rail connection today, and could I get there from Chicago or New York? Asking since I will be doing a cross-country train trip in 2026 and hadn't even though about dipping into Ontario until I saw this video.
How would these big developments ever be profitable for a city if all the 'growth' that results from the new industry is single family sprawl and strip malls? We know that single family developments are a net negative for city budgets so I don't see how it can add up. My town is doing this with big semiconductor plants and all the new growth i see is single family sprawl.
How does Strong Towns delineate what a "rapid" expansion is? Did ST do the math on sustainability for the St. Thomas' expenditures and debt service? How does ST decide which kinds of infrastructure investment are worthy of their stamp of approval? There are so many questions I have about how secretive and unfair the process was for St. Thomas in pursuing this opportunity, but I have just as many questions about ST's judgmental attitude after explicitly saying you should "do the math" before passing judgment. And, as a side note, I really don't get the "household budget" analogy unless you think people should only pay cash for their homes and cars. Investing in things that can provide a return on that investment over a long period of time is an excellent reason to take on debt at a community scale. Infrastructure is valuable if it gets used. There's always risk involved in any investment. Does Strong Towns disapprove of the national infrastructure bill because it's financed over a long period of time, too?
@@Rejinx alteast it made the younger generation aware the mistakes made by boomer. In my car centric country (Malaysia), younger gen are less interested to buy cars and prefer public transportation
@@gruzit2622 yep, there's definitely a growing movement to make things less car-centric here in Ontario because of not just bikes and his dragging us through the mud 🙃
The Mayor seems rather naïve: "just say yes, and ask questions later". Is Volkswagen taking on any of the risk here? Are they contributing to the infrastructure upgrades needed? Is there any clause that says if they pull out, they have to cover at least a portion of the town's debt? If not that seems like a very unwise deal that could be dangerous for the town.
@@mdhazeldine It seems like, in this case at least, that if this town asked those questions, then another one that didn’t would’ve gotten the deal. I think the only way these problems stop starting is when all towns are asking those questions. But it only takes one Mayor with a “just say yes” campaign to keep the cycle going. I think this is another one of those uphill battles where it takes all of us to push together to win.
@@b_dawg_17 remember the AMAZON HQ2.0 "bidding war" FROM 10? years ago where cities and counties climbed over each other to out cut taxes and build infrastructure
@@aether388 Joe isn't naive, a couple roads and a sewage plant we'd need anyway within 7 years is a small price to pay for a large manufacturer. If anything the province and country have a larger stake in the game.
The city I lived in before had a deal with IBM where the city purchased a massive building that they agreed to lease to IBM for $1 per year over 15 years. From what I remember, they also promised ~$55K annual average salaries and 800 permanent positions at the company during that time. I don't think they ever hit the 800 number, their average wage was a bit below the proposed $55K and that was before there were more layoffs at the site and then eventually IBM just left town entirely. I can only imagine how much money was spent to attract a company that measured their worth in billions and promised the world, but underdelivered...
Volkswagen has less freedom than IBM to get up and leave because they’re doing manufacturing, rather than tech. Doesn’t mean they can’t. In Australia, GM shut down Holden despite massive government grants to keep it going.
What's bugging me is that there are so many abbandoned industrial areas, especially in the west of the US that could be reused. I understand that local governments are forced to attract businesses, but this must not be this way. Cities shouldn't be forced to fight against each other like this. It's about the wellbeeing of humanity as a whole and not just of their own people
TBH they are those areas in Canada too. Hamilton (just 1hour away from this town) has several abandoned steel plants in the industrial area that ought to have been reused for this plant. Those sites are also connected to a large port which would enable shipping of goods in/out via the great lakes or by rail rather than by road. However, Hamilton did not vote for either the provincial nor federal government (they vote for the 3rd party in recent elections) so gets almost no investment.
The whole point of selling shares in a company was that it was a means by which companies could raise investment capital to allow the company to grow. They had to make a convincing argument to attract investors though, because the investors were using their personal money and knew they stood to lose it all investing in something stupid. Something is seriously wrong with an economic system that allows companies to use their profits to buy back their own shares (Which used to be illegal) while petitioning governments to use taxpayers' money (Rather than their own, which they care about a lot more - especially since most of these companies aren't above a bit of bribery), to pay for the expansion of private companies. That this expansion usually comes without any government ownership of the company, mandatory sharing of profits or massive penalty clauses if the development doesn't deliver to the local economy as promised, is even more shameful. Capitalism has taken on all the bad parts of communism while forgetting that the benefits are also supposed to be shared. In a world where we literally just saw that less than 0.1% of a billionaire's personal wealth is enough to buy the government of the biggest economy on the planet, this shouldn't surprise anyone at this stage, but boy should it make them angry.
I’ve been asking these risk-hedging questions myself for years. Why are government officials willing to trust pinky promises by corporations to spend millions without any concrete hedge against breaking their promises? It seems like something Chuck would have talked about so there’s got to be something going on that allows us to stupidly accept all the risk & give all the rewards to the private companies (AKA non-citizen people).
@@ttopero Absolutely, this is what I do not understand anymore. Companies routinely put in guaranteed revenue clauses into contracts with governments, so why aren't governments doing the same? If a company wants a gov't to build them X infrastructure, they should guarantee Y tax revenue to pay for it once the plant is operational. If they fail to deliver the company is has to pay fees equivalent to the shortfall in tax revenue.
@@mikemoore-hehim1149 Marx pointed out the instability in capitalism, its tendency to concentrate wealth, its disregard for workers except as productive units, not 'owning' their work output. Extracting a 'rent' by owning a resource. For 40 years, wealth has been extracted rather than distributed. Workers are progressively poorer. Private capital buys up businesses, delists them from the stock exchange, load with debt, extract wealth, and ultimately, sell off. And the huge accumulation means corporations can 'buy' governments.
Funny watching this from a town (Chattanooga, TN) where we have a huge Volkswagen plant. We sunk lots of money into infrastructure and deferred millions in tax revenue, seems worth it now but not sure how the numbers will work out in the end. But we are less precarious than St. Thomas because we are much larger (city/county has 183k/383k people vs 43k)
And keep in mind how risky it could be. If that plant was shuttered early, it's a pure net loss. And even if it gets through the initial payoff phase, there's still a lot of maintenance liabilities that depend on that factory sticking around
Has the town developed a specific plan for how to accommodate the growth it expects? Is that plan consistent with Strong Towns principles? It would be a shame if they bet the farm on this EV plant in a way that leads to growth that undermines the long-term resilience of the community (similar to what has occurred elsewhere throughout North America).
I'm a planner who lives not too far from St Thomas. From a quick look at their planning docs, I'd say no. Being a former railway town, they have this beautiful right-of-way parallel to downtown that leads directly to the new factory. Absolutely unbeatable candidate for light rail or a DMU/EMU train. Unfortunately, I suspect they will completely miss the opportunity to preserve the space for higher order transit, and go all in on cars. Then complain about traffic. 'Tis the Ontario way.
@@mattr0103 who OWNS the right of ways and I assume the 2 MAJOR road expansions will also spur NEW town growth along it for factory workers to move to I assume it will be 100% sprawl based detached homes as that is what "people want" when moving to a SMALL town for a factory job
@@mattr0103 Train is overkill for that corridor, and there is no planning trouble here. We will probably do a bike path there and dense housing. You can get from one side of town to the other on a bike in less than 10 minutes.
@@jasonriddell It's not sprawl (other than stuff built 1970-2010), look at 2/3 new subdivisions in St. Thomas and you will see it is more than 50% townhouses and semis and apartments.
I remember that all the claims about this ev battery plant were being made about musks proposed lithium gigafactory like 15 years ago and they all fell completely flat.
Okay, but think longer term than that. In 50 years, will the Tesla factory still be going? When one industry dominates the employment of a town, the wellbeing of the town is determined by the success of the company.
@@JohnFromAccounting problem is this town LIKE thousands LOST its main employer and is morphing into an EXURB of TO and towns of NOTHING but houses and shopping is NOT very financially viable and in this day and age there is NEAR ZERO chance of having a home grown hero along with other mid sized business move TO your town when there market is up the highway along with there suppliers and clients
Building "Just one more lane, bro!", rather than, say, a light rail line, to connect to "fake London", seems a missed opportunity. I wonder what @NotJustBikes thinks of this project, and this video
@@pdblouinif it connected the two cities & also connected the plant, it doesn’t seem like as big of a gamble as building one to a new subdivision in hopes of creating demand for the houses
@@pdblouin not really. If we were to treat rail lines the same way we treat highways as a transportation route that doesn't need to generate revenue, but building and maintaining them with tax dollars is necessary for economic development. Unlike multi lane highways they are cheaper to build, maintain and they help pay for their maintenance unlike highways unless you slap toll booths on tjem
Oh boy. We can build giant battery factories to try to force this electric car thing through, overbuild infrastructure that can't be maintained in the future, and call it an opportunity. Trains and transit would have a much better impact, but we're brainwashed.
@ it’s not that I don’t believe electric cars could never surpass ICE, but I’m a little surprised at how quickly they’re trying to make it happen, and the lengths industry and governments are going to. There had better be some major battery technology breakthroughs, because there is no way to create as many electric cars right now as ICE cars thay currently exist. The materials can’t be sourced. Cars have also become insanely expensive. This channel is primarily centred around alternatives to building sprawling environments, so its naturally going to lean more towards alternatives to passenger vehicles anyway.
Trains and transit need to connect people to economic development to be productive. They are a booster, rather than a replacement, to said development.
I'm not against cities growing and being successful, but none of this sounds like Strong Town's principles. Sounds like this town is destined for suburban sprawl, big box stores and parking lots as far as the eye can see. I really hope that isn't the case, but none of this video covers how this town is preventing that future from happening.
the town is already becoming a commuter exurb and the plant will attract NEW people to the region looking to buy a detached home and "LOW" traffic congestion and likely that will be true and widely available WHEN THE PLANT OPENS
@@jasonriddell Seems to be that every new and upcoming town is like that now. Like there seems to be only 2 ways to grow a city: commuter exurb or heavy gentrification. I'm tired of those two being the only options. I really try to stay optimistic, but it feels like even Strong Towns is losing their ways. I feel like the only way to fix this problem is to change the tax system. Like Georgism seems to be the only thing that gives me hope nowadays.
Wonderful content aside (seriously, love it) you may want to consider filtering the high frequencies out of the tubeTV-turns-on sound effect in the intro card for each section of the video. It's a very accurate sample - in that the pets and myself were surprised by that dreadful loud, barely-perceptible screech several times. I thought I was going crazy for a minute.
Here's a simple idea that could save cities from the total cost burden of these projects if they fail to materialize. I think if a large corporation is planning/asking/agreeing to bring a massive project to a town/city, it should be contractually obligated to cover some, if not all, of the infrastructure improvement, should they back out of the deal? For example, Foxconn should have been on the hook for at least a percentage of the cost Mount Pleasant invested to bring them to town.
There’s got to be a reason government officials accept all the risks on our behalf & give all the rewards to the private enterprise to be extracted from the community. I don’t know why we can’t get equity in exchange for the obligation we incur
That would be better, but the company is the one with negotiating power here. Why would they take that risk of being liable, when there are a dozen other towns that are willing to fund the infrastructure themselves? Corporations are able to operate on an international scale and choose from whoever gives the best deal, while municipalities just don't have that kind of bargaining power. There would need to be national or international regulation on this kind of thing in order to force corporations to stop getting away with this.
@@Sahil-oq8ki bingo would need to take NON "free market" friendly steps like nationalizing that level of development AND likely tariffs FOR companies that DONT build in the country
We read a really interesting paper in grad school this semester on 3 large coal mines in B.C.after being built and operated for a few years, only 59% of forecasted employment and 34%(!) Of tax revenue materialized. We need to do a very, very thorough job of vetting these "big bet" developments if they go in, and perhaps focus on smaller, more local and accountable businesses. Are these big companies creating wealth or siphoning it?
This probably is a blind spot for most politicians. It seems that greed & nepotism shows up when they get a sample of power-like a drug they can’t avoid & instantly addicted!
@@ttopero would NOT go that far and look at "simple" politics voters usually care about 2 things 1 THERE JOB and 2 being able to CONSUME MORE then before and "landing" a HUGE employer will win on BOTH FRONTS
@ I’d say it’s a learned cultural characteristic that has been systematically imprinted on us for decades if not centuries. We can choose a different way to get our needs met without giving up our soul
Well, across the globe there is an even shinier example Soviet Union build towns upside down: First, in a middle of nowhere, usually in desert, or tundra, a huge factory employing tens or even hundreds of thousands of employees is being built Second, a lot of population - across the ethnic republics usually - is forcefully moved to live in a city built around the factory Then, it collapses, factories gets bankrupt, 80-95% of population leaves the city And I was living in one of them as well
The unfortunate news for St. Thomas is that we are quickly coming to understand that large scale battery manufacturing isn't sustainable or even needed. Applying it to personal vehicles larger than bikes just isn't feasible, and applying it to busses and trains is much worse than just installing overhead lines.
If I may make a suggestion, can the tinnitus pitch be removed from the transition scene sound? Listening on an earbud that sound is borderline painful if the rest of the audio is loud enough to be understandable. Loving the video otherwise! I come from a smaller town that went through losing manufacturing in my lifetime so I find the subject matter and discussions fascinating
I never thought I'd see a Strong Towns episode done for my hometown! I saw the thumbnail and title and thought, this sounds like a similar situation St. Thomas is in, and sure enough, its literally about my town!
I've played enough games of Cities: Skylines to know what happens when you overbuild infrastructure without any tax base. It's not rocket surgery. It's just math.
Main problem- *if the plant ever comes, they already have all the leverage, and every level of government is eating out of their hands. All future town plans and tax money, who do you think will be directing them?
the national government has placed a 100% tariff on Chinese EV cars AFTER BYD was looking to open up in Canada to "protect" the Canadian battery "ecosystem" so consumers are blocked from better and cheaper electric cars to protect these companies before they offer ANYTHING into the market this from the same government pushing for ALL cars to be electric and has a carbon tax in place to "help" the transition so before these plants have done anything they have already gotten the government to make there stated goal a harder reach
So, small town resident here. An actual small town (~6000 people), not a small city large enough for agencies like HUD to consider it urban. This isn't what we want. It's not that we don't want manufacturing jobs, some of those would be great, we don't want to become company towns fully dependent on a single business or industry to thrive. We also don't really want to grow our infrastructure, at least not haphazardly.
ANY factory of scale would double your town but in this case this is not 10 percent of the regions population and less then 20 percent of the TOWNS population and the town WAS a factory town before FORD left so this is more of a return to form for the region
@@jasonriddell right. A gigafactory would be dystopian here. Even a factory that might employ 500-600 people would be "too many eggs in one basket" for our local economy, at least in my opinion. It's not that we wouldn't want industry, just not the sort of industry that would redefine a community.
How fascinating, I've been working recently on the rail crossings that will be located on this site. I must admit, I don't know much about the project beyond this little element, but it's fascinating to see a video about a project I've been involved with on a whole.
This topic reminds me of a local development near myself-the Panasonic battery plant in DeSoto, KS. My fear is that it will promote more suburban sprawl that eventually spans all the way from Lawrence to Kansas City
Yeah i think in addition to the debt, these mega sites kind of upend the traditional development pattern by putting all the jobs decentralized out in the middle of nowehere
Cities and Towns plus state and federal should be investing in nonprofit worker cooperatives instead of giving all this money to large greedy useless corporations
In other words, major corporations have figured out how to offload the risk of development, two cities and have them take on all the debt for the project. The company still may suffer some inconvenience if the factory work out or they change their minds, but the town has taken it on massive debt and it’s committed itself, probably communities around it to this particular path which states somehow deeded to justify with income in the future. Because we live in a world where the highest urgency is to re-localize in order to become resilient against supply chain disruptions, which will be a feature creasing a feature of our futures because of extreme weather we need a very different outlook. Tells that commit to giga factories are committing to the global supply chain. The global supply chain is increasingly subjected to ever higher more intense forms of disruption and risk. On top of this, these giga factories are the process of climate change large scale projects represent energy intensification. The larger they are the more hierarchical they are and the higher their energy intensity, this bloats energy use. You can’t get away from it. You caught energy intensity and use by re-localizing.
We need to look only at Ingolstadt, Stuttgart and Wolfsburg for examples of cities that were transformed by one industry and are still going very strong. Germany faced enormous post-war economic struggle, and auto industry manufacturing was able to rebuild many cities. North America is not in the same position, but I think it’s more likely that St Thomas will succeed. It won’t be true for every location.
Here's to hoping! I'm seriously and rooting for St Thomas. Like, I literally want them to succeed because "them" are everyday people and I want the best for people.
Back in the early 80s, in Brantford Ont, we had Massey and White farm in town, by early 1986, they were both gone. in 1988, my then-wife's uncle sold his farm and some cash, came into Brantford and purchased 23 houses.. That is how depressed it was. But in the years they have brought many factories, mostly food type factories, like the folks from Italy, who are Ferraro. And many others, you drive through their new industrial area and there are like 50 plants there
"Due to collapse in our EV sales from fires caused by our competitors' vehicles' shoddy, tofu dreg construction, Volkswagen will not be operating its Saint Thomas EV battery production plant and will seek a full property tax abatement."
more likely "VW goes bankrupt - bailed out my union / German government on the condition ALL VW production moves to GERMANY and VW battery Canada is NOW "bankrupt" and wont continue with this project" North star battery also building out in Ontario has gone bankrupt in Sweden but right NEW promises continued production a battery anode refining plant in BC Canada is being "withdrawn" due to "hostilities" towards CHINA
Makes me think of velocity of money, for example you go to bakers and buy a loaf of bread, the baker goes to the mill owner to buy more flour, the mill owner goes to the farmer etc your single dollar circulated through all those people. There was a place called "black wall street" which had such high velocity of money that a dollar in the community would stay in the community for a year and get exchanged an average of 25 times. Whereas now in black communities in the US a dollar stays in the local economy for an average of 16 minutes and is not exchanged once.
@@eeesti216 0:16 Well then it’s going catch fire. I hope everything turns out well for St. Thomas. VW is having serious financial problems. The Chinese EV’s are less expensive and the quality is high. China leads the world in EV sales. They are also the leaders in battery technology. Even Tesla uses their batteries. VW will do everything to avoid falling on their own sword, including abandoning commitments that are not profitable.
it can be great if they do it intelligently i.e. integrating quality of life features like rail/train transit, walkable neighborhoods, frequent grocery stores etc into the new development if its just "here's some roads and a factory, and here's 5,000 mcmansions and condos off one giant cul-de-sac enclave with one lane leading out of it that has no shopping inside it at all" it'll be terrible
This reminds me of a chapter from the book Soccernomics. They discuss why cities beg private companies to come in and build stadiums and host big sporting events. They even give these corporations big tax breaks and financial incentives using our tax money. These companies take government money (the taxes that we pay) to construct these stadiums and take a lot of the profit as well. If the stadium succeeds then the company profits, if the stadium fails then the local city suffers more than the companies. So it's a win-lose scenario here. The only true benefit of hosting a big event is the "emotional happiness" but not financial success. We enjoy following an event if it's happening in our hometown and if our team does well. But that's pretty much it.
Do you know if there are any plans in St. Thomas regarding: 1. changing zoning laws to allow something else besides SFH, 2. removal of minimum parking requirements and 3. investments towards protected bike lanes and public transport, instead of just more lanes for cars?
I ask the mayor a bit about that in my long-form interview that'll be coming out for ST members. I do ask about if there will be any way to access the EV plant by bicycles and other means, other than driving. That'll be out in the next week or so, I believe.
@@jasonriddell but if you want me to try, here are my answers: 1. I believe they're adding density to downtown and I'm excited about that. 2. I'm not sure if they'll be removing minimum parking requirements, 3. I don't think they're moving forward as fast as they should when considering alternative modes of transportation.
Whats the current guide lines on "leap frogging" development like this? I understand the pit falls, benefits and best practices for housing developments but not industrial developments. How are they different from large housing developments and how can affect their local town. Can they bring in the large plant then work to pay of their debt and strengthen their town from another bust cycle?
I don’t know, this one feels different to me than the typical “build the infrastructure and then hope development shows up to pay for it” model of suburban sprawl. You’ve got a solid company looking to build a plant to serve future (rather than past) needs, and they have specific infrastructure requirements. Yes, it’s huge and yes there’s risk, but it’s spread across the municipal, provincial, and federal levels. The only real difference between this and the small bets you prefer is that this is big. It’s a gutsy move and I hope it pays off!
@@JohnFromAccounting regional food production is more important than effective usage, and due to climate change now more then ever. You cant eat money. This land can never be turned into farmland again. Good quality farmland should stay farmland.
@@kingbeam80ify Both batteries and food can be shipped long distances. It makes the most sense to evaluate each individual piece of land to determine if it's better off as a farm or a battery factory. It doesn't matter specifically where the food/batteries are produced as long as they are located reasonable close to transportation infrastructure.
The question “is it worth it?” completely depends on what the town does with the revenue. Do they use it to subsidize suburban development to support housing demand, or do they invest in a creating a desirable, livable small city that can still sustain itself if the industry leaves?
Huh, that's a good point. I think they might've meant that the "higher levels" were under NDAs, so they couldn't get that information at their lower levels. But still a good point.
I don't like big factories because no company should employ more than 5% of the working population. That's not a resilient economy. Moreover, while infrastructure debt isn't inherently bad, I don't think humans are ever very good at predicting how things are gonna play out and what will or won't play out.
@@BenDurham I'll elaborate if you cover the US's Inflation Reduction Act which is the only reason Canada had to put up so much money for this. You can look at the billions spent in Michigan, Tennessee, etc.
While all you say is true, the landscape has changed dramatically over the last 50 years. A hundred years ago, no company would have needed a single plant this size, they would have started small and ramped up slowly. The current landscape doe not allow for this any longer. Next point is that building something this big would cost way more closer to a big city that could handle the investment. You have these issues around the world, for example, when Intel said they build a factory in Germany that never happened. The biggest plus for this project is that VW needs a battery plant badly to keep up with the future and since VW still is the second largest car manufacturer in the world with a revenue of $340 Billion, it is very unlikely that a project that is already in development, will be canceled.
@@gloofisearch I don’t think I’d say it being in development for VW makes it “likely” to happen. If anything, those things make the project less likely to happen. VW is in deep, deeeep financial shit atm. I’m taking to the point it’s a question as to whether or not there will even be a VW in 10 yrs time. Half of its revenue & almost all of its growth was concentrated in the Chinese market. That’s gone. They’ll be lucky if they sell enough cars in China just to keep the lights on. And that market ain’t coming back. Their sales in the US have been in free fall the last few years & never truly recovered from “Dieselgate” before that. The electric car market in the US is beyond saturated & likely won’t come back until EV prices drop considerably &/ or battery capacity/ range roughly doubles. On top of that, the only reason they would build a battery plant in the US is to qualify for American EV subsidies & avoid possible tariffs. The tariff component is still there, but EV subsidies are likely going away. Even the rosiest projections predict VW won’t sell enough EVs in the US to break even. Those have VW rocket to the top of EV sales by manufacturer. In all likelihood, reality will see the opposite. VW’s electric vehicles have consistently ranked dead last in class by range. I’m talking their top end, extended range models often boasting a 150 mile range vs 250-400+ miles from competitors. Did I mention VW has become notorious for poor reliability over the last few years? Even lifelong VW customers are being forced to reluctantly call it quits on the brand. It’s really, really bad. And they aren’t the only European brand struggling. All of them are in dire straits. That means lots of competition for bailouts. It doesn’t take an MBA to see they aren’t going to be able to open that plant.
@@williambrasky3891 there are CHINESE cars that WITH a 100% tariff are a BETTER value then VW "ID" cars and they are ONLY getting cheaper and better as more and more of the world buy them
The city + province are spending $100,000,000 on new infrastructure, which will last ~30 years. The mayor says they do not expect tax revenue for 5 years, which leaves 25 years. So the infrastructure building cost of $4,000,000, per year, plus cost of maintenance, plus interest. At 3,000 jobs, the cost equals $1,333 per job per year minimum. However, like the tax revenues, the jobs would also ramp up and possibly down in a recession. Moreover, EV sales world wide is down. If the 3,000 jobs only last 10 years, that’s spending 100,000,00 to get 30,000 job-years, or $3,300 infrastructure spending per job-year.
EV sales world wide are actually up. I always wonder about those infrastructure spending figures - are the politicians hiding the real cost in other budget chapters or are they doing the opposite by including stuff that would have to be done anyway.
I will predict that this EV battery plant will never actually open or if it dones it will be at a greatly reduced volume. Governments are pushing EVs but the car buying public has most said no thanks. Government subsidies are causing a false signal to the market and this is why we end up the these kind of projects that in the end the taxpayers is the only one left holding the bag.
Tell that to President Musk. The Public won't have a choice, EVs are cheaper to make and the investments are already being made internationally (despite how expensive they are to the consumer). If they are the only thing for sale, everyone will move on.
Would suck if VW changed their mind and cxld the project. Would St Thomas be on the hook then for all these up front expenses? Why don't these companies contribute to these up front costs?
As a resident of ST.... Good reporting , having worked in Ottawa b4 retiring here I'm surprised how much time you spend on mechanic of the govt funding.... No question , plant will be more-balled at least , during the up coming ' tariff war's ...and I suspect cancelled it CDU..takes the German election coming. IF ..you thing PPee...can save the deal ...I have a bridge for sale....???
In my city of 45,000, the words largest yogurt factory (chobani) was built like 10 years ago. And then just a couple years ago they built the biggest cliff bar factory right next to it. I don’t know how cliff bar is but the owner of chobani is actually a very good person giving away a ton to the community. Donates to teachers and is currently building a park. I guess he started in New York and somehow made his way up. It is however a problem that chobani uses way more water than allowed. Idaho is one of the biggest water consumers and I think that may be why he came here because he could get away with it. Not sure though
I'm about to say something very controversial; the opinions represented in this video are closer to "conservative" as discussed by Edmund Burke. Spoiler he was a conservative debating Thomas Pain in a series of articles during the French Revolution, neither of which are important what is however is his view. To summarize and overly simplify his argument as well as using urban planning as an example. He may liken the gigafactory implementation as short sighted and irresponsible as well as potentially deadly for the residents of the city. He could push it to state that the elected officials are being grossly negligent by chasing after something other than the immediate well being of their constituents for something that could and likely would cause grave damage to them in the future for little to no reward for any one but a select few. Burke was a fan of slow and steady change even if it meant there would be many great opportunities that would pass the state by, because those that work are vastly outnumbered by those that do not. It's different if a private citizen takes the chance or a company, a government should not. Edit I'd love a video that discusses the incremental development of towns as it used to be done. it's difficult to find that on youtube, may have to look on brilliant.
Strong Towns IS a conservative movement. Chuck Marohn expresses conservative opinions all the time. Do these line up with equitable outcomes even for the most liberal people because of how efficiently cities must be built to accommodate this thinking and elevate tax receipts? Sure. But yeah, Strong Towns has opposed many things that aren't incremental outcomes provided exclusively by and for municipal governments or its people
Regarding your video request: Chuck has several videos describing the iterative development of Brainerd, his home town. Check the older presentations to cities. What we don’t hear about is how do we do the next iteration now when we’ve created a place to a finished state & still have debt/expenses on existing infrastructure even if we replaced & updated/upgraded it. Before the last iteration, each one created a whole other level of quality improvement & wealth/value growth as it was replacing something of much cheaper & lesser quality value.
trust me - many of us would love US conservatism to go back to "fiscal responsibility" and not bs about social issues just to get more power to big business
@@mikemoore-hehim1149 It's all about the GDP. Gotta get that GDP up. More is always better. Lie about that figure if you need to and ignore the consequences. "The economy is actually doing great guys, because GDP is WAY up"
Interesting though that VW had the option to pull out even though local and national governments were already investing in expanding infrastructure for their benefit.
I enjoyed the look into this development in St Thomas but I think the video kind of went off the rails in the 17:30 segment. Out of nowhere you jump into making spooky insinuations about ponzi schemes and the spectre of debt without even once touching upon the concept of wealth creation, which is the critical element that separates a ponzi scheme from a sound, prudent investment, and what pays for the future costs of taking on debt. This is exactly what "doing the math" is about: comparing the value of the potential wealth creation against the cost of servicing the debt necessary to achieve it, factoring in the risk of lower (or higher) returns, and it's almost inexcusable that you pay lip service to "doing the math" without even attempting to explain to the viewer how that math may or may not end up adding up.
in a grander scale we DONT help EV production come to canada and watch as the CHINESE take over the market and look at the knock on job losses as the rest of the gas car plants close as they CANT compete against the better and cheaper Chinese brands so at that "scale" what is the risk / reward look like
I think the huge difference is 3,000 salaries (if that ever pans out) is something, but where did 99.9% of the revenue go, it was all taken out of the local economy.
Even with that amount of salaries, for a local economy it can be difficult to recoup those costs. The reason is with more people comes more costs unless you increase density generally. Add to the mix that if your tax revenues do go up and costs don't, people will bitch about paying so much in tax and paying so much in interest. Cities need to stop doing this shit. The costs never recoup. Take the 80 million loan. Let's say they get 3k extra tax payers. Even if every single person moved and lived in st Thomas, it's equivalent to 27k per person just to cover the loan principle. All the while corresponding service costs will go up and less of the money taken in actually goes to services but just services the debt. I will be shocked if this pays for itself 🙄. If we are gonna do shit like this we should get a piece of the pie. If companies are gonna do this maybe we should get a percentage of sales or whatever. Ffs you could pay 3k people to move to st Thomas for 26k each and probably create more benefit in doing so.
@@Donthaveacowbra if you have 3k people directly working in the plant you end up having another 3k people that are doing contract type work for the plant. You also have people that are making a fairly high income who are spending that money in the city which supports other businesses growth.
@@Donthaveacowbra math gets harder first 3K direct jobs equals 3 to 4K NEW consumers to the local businesses and all the support jobs and businesses add even more plus "support" businesses like NEW schools and hospitals and grocery stores in Germany ONE VW factory worker is worth 4 NON factory jobs
I really live strong towns and repeat 99% of what you say, but, while im not from St. Thomas, as an Ontario resident I am very much in favor of this project. I can accept the argument the plant should have been in Oshawa or Sault St. Marie or Hamilton Or Windsor etc. But the reality is we desperately need to pull investment. Ontario's economy is so heavily based on Auto Manufacturing, and I have very little confidence we will maintain that role over 20 years as ICE engines decline. We already struggle to keep these industries, and its not just jobs, and not just well paying jobs for a subset of the population that doesn't have white collar transferable skills, its our balance of trade and currency stability. There is a reason this was driven by the Federal and Provincial government, its far more important than municipal level. But more then that, we talk about a few km of highway here. But what jobs are in St. Thomas? How much of the community is commuting to London and making demands on highways? And also, it has to be noted that unlike the US, municipal debt is under written by the province, and province provide transfers to municipalities. So this isn't being forced on them alone. I get this could go wrong and Volkswagen could pull out. Tariff threats don't help with that. But we desperately need a return of industry on an enormous scale because our existing industrial base, and potentially all those industries that feed into it, are on the way out. Not taking a risk here is like not risking swirving off the highway while you drive toward a frieght truck.
@@JohnFromAccounting USA / JAPAN / and GERMANY will be wiped out economically of there car manufacturing goes under we are seeing US apply huge tariffs and other import LAWS against Chinese EV makers and Europe is trying the same and Japan "forced" Honda to buy out Nissan to prevent FOXCONN from buying them whole look at American steel / Nippon steel" being blocked and American steel is about to fail into bankruptcy without Nippon buying them
Really hard to know if it's a good idea without knowing the contract details. If you have that information, it's a simple calculation to determine the ROI, IRR, or payback period. And what amount of debt is the city actually under? What are the payment terms? Sorry, it's all MBA stuff and very boring but necessary!
Not exactly as the direct contract won't even come close to paying off the loans they take out. Usually it's "we will make it up in increased tax revenue". If cities bend over backwards to get a company to come they have to keep doing it else they threaten to leave. Same thing happens with sports teams. You stop this by either getting a piece of the pie, unions, or a mix of other things.
@@Donthaveacowbra there is the 1 to 3 jobs created for every factory job so there is the widening of the tax base and what is the current POST FORD economic shape like
Why is this so difficult? If your product requires subsidy then it is too big. If you can’t openly reveal your finance structure then it is corrupt. If your start-up cannot demonstrate solvency then it will not work at scale. These are not difficult questions to ask.
not sure if it is good to have all eggs in one basket.... one company to rule them all, oh different topic... no, really i know 300 jobs can be build at once, but also gone at once... local small businesses can create also jobs...
Given the recent issues with VWs move to electric cars, these folks are toast. This level of infrastructure requires up front cash from the companies involves to mitigate the risk, at least 50% or more to prove they are serious. Since no one is giving you any numbers, it is pretty clear that VW can walk away from this if "Economic conditions" change. Right now hybrids are still doing OK, but pure electric is not doing very well due to lack of charging infrastructure discouraging buyers from taking the leap. I doubt that the town put any conditions on their infrastructure work being reimbursed from the province if VW walked, that was a mistake as well on their side. Basically if your spending all the money up front, you are the sucker in this game.
recheck sales CHARTS EV sales as a whole are going up in EVERY MARKET outside of GERMANY and Canada is over 15% EV right now and is climbing with Quebec and BC being over 30% Mexico is talking about tariffs on CHINESE EVs to fall in line with Canada and the current USA levels opening up Mexico to EV batteries made in Canada VW themselves are in DIRE SHAPE IN GERMANY because of being all but closed out of CHINA and sub par EVs and software BUT every foreign OEM NOT NAMED Tesla is all but dead in CHINA right now as there is 150 car makers all in a BLOODY price war
If the people pay for the company, then why do the people work for the company rather than that company providing for the people? The people do not owe the company free labor, and if your income pays your employer to pay you, then you act part owner as a tax payer. Basically, the people own the government, so all the government investments in must pay back the people or they can take it from the former owner who can't afford to repay the investors.
If the town is going to get maintenance responsibility without the guarantee of the tax revenue to support it, it's almost certainly not a good deal to make deals with an employer. You can't assume the workers will be paying taxes there.
Having one major business or industry in a small town is always a recipe for disaster. Great for a while but industries always shift and not all towns can reinvent themselves. Something to be said about a diversity of jobs and employers and not relying on only one main player. Eggs all in one basket kind of thing. When the jobs and people leave it is hard to have the city/town revenue from taxes to improve infrastructure and quality of life for those who remain.
how do you "build" a lot of small to medium NON SELF SERVING businesses and not loosing them to far bigger markets fake London up the autoroute has 5X the market size and Toronto has 100X the market size AND all the suppliers are support businesses so how do you keep them from NOT going to the far batter markets
@ by that logic why would anyone not open a business in the biggest market possible? Why bother with any other city if it isn’t Toronto? That is flawed logic. People setup business in the communities in which they live at the time. The real question is how cities can incentives people to move and setup small the medium sized business in the community? How to make them thrive.
I am aware that large and huge size companies setup along highways and train lines, but that is due to size and logistics that aren’t factors for small to medium sized companies.
How will the company repay the tax payers to regain full ownership of the company they invested in? I know the pay the employees reseve is for labor, so non of that is applicable. Also, how does a government make non disclosure agreements work? How do you get the voting population of a city to be trusted to not talk about something? That's thousands of people, and if you don't tell them it's only money from the negotiators, as the tax payers must know the content of NDAs to use there funds. Doing so without that information means you are taking a loan out to be repaired to them in your own name.
Dang it! Do you happen to be listening to the video on 2x speed? Just attempting to troubleshoot this. Because I know the SFX that you're referring to, seeing as I added it into the many layers that make up that transition sound. But at regular speed, it seems fine. But I now hear it when listening at 2x times speed, unfortunately 😬
Welp, gosh darnit. It past by a bunch of people - including myself - and it didn't get flagged. I've learned my lesson about mixing those high pitched sounds in. Just wish I could fix it now that it's live. Sorry about your ears 😢
Some small towns don’t have a choice in this matter. Rather than natural growth, there is definite shrinkage and without a big employer the town will slowly die off
Title suggestion, "Big Factories Do Not Help Small Towns" Be direct and clear, titles are so wonky these days. I always want to know exactly what the video is about before I click. Your title was clear to people who already watch your videos, but some people might really think the opposite so a vague stance on the video might allow them to more easily ignore it. A lot of the title doesn't even show up on my screen in the feed. Short clear titles are everything imo
I remember back in the day where companies actually used their own money to build places, rather than the government begging to give them welfare cheques.
@@Alex-cw3rz When was this? Back when the corpos ran their own small towns and could expect the government to show up with the army when the residents rebelled?
There was never a time when people with money didn't suckle on the state teet. Old south slavers invented police patrols to control their labor force. Silk road caravans needed Tang dynasty cavalry regiments to ward off bandits.
The difference now is just that we're all supposed to accept this as good for the economy and thus ourselves.
lol. Didn't expect advocacy for company towns in a urbanism channel video....
Mining towns in Australia were generally built by one employer, and the success of the town was 100% reliant on the mine’s continued use. If the mine shut down, the town died.
@@TulipQ I'm from the UK so we had non of that and the businesses had to pay for everything themselves. But just think the world is a hyperbolic USA.
@@MrEdHasibuan1996 company towns? The population here is 40,000 the jobs are 3,000. They wouldn't be a company town it would be a single suburb of a larger town that they payed for, which is what always used to happen. Look at Port Sunlight for example.
Hey everyone, Ben Durham here (the video creator)! This was so much fun to work on! AMA and I'll do my best to respond.
Hey Ben! As someone who enjoys your videos, I am proud of you for this amazing video! Does St. Thomas still have a rail connection today, and could I get there from Chicago or New York? Asking since I will be doing a cross-country train trip in 2026 and hadn't even though about dipping into Ontario until I saw this video.
How would these big developments ever be profitable for a city if all the 'growth' that results from the new industry is single family sprawl and strip malls? We know that single family developments are a net negative for city budgets so I don't see how it can add up. My town is doing this with big semiconductor plants and all the new growth i see is single family sprawl.
How does Strong Towns delineate what a "rapid" expansion is? Did ST do the math on sustainability for the St. Thomas' expenditures and debt service? How does ST decide which kinds of infrastructure investment are worthy of their stamp of approval?
There are so many questions I have about how secretive and unfair the process was for St. Thomas in pursuing this opportunity, but I have just as many questions about ST's judgmental attitude after explicitly saying you should "do the math" before passing judgment.
And, as a side note, I really don't get the "household budget" analogy unless you think people should only pay cash for their homes and cars. Investing in things that can provide a return on that investment over a long period of time is an excellent reason to take on debt at a community scale. Infrastructure is valuable if it gets used. There's always risk involved in any investment. Does Strong Towns disapprove of the national infrastructure bill because it's financed over a long period of time, too?
Adding your podcast to my weekly rotation!
St. Thomas looks like a beautiful town
Fake London is producing TH-cam urbanist at an alarming rate.
@@Rejinx NJB has that effect on people 🤣
@@Rejinx alteast it made the younger generation aware the mistakes made by boomer. In my car centric country (Malaysia), younger gen are less interested to buy cars and prefer public transportation
@@gruzit2622 yep, there's definitely a growing movement to make things less car-centric here in Ontario because of not just bikes and his dragging us through the mud 🙃
when you are so bad at something, that you shape an entire generation wanting to fix you
That's totally normal, a disease triggers an immune response.
The Mayor seems rather naïve: "just say yes, and ask questions later". Is Volkswagen taking on any of the risk here? Are they contributing to the infrastructure upgrades needed? Is there any clause that says if they pull out, they have to cover at least a portion of the town's debt? If not that seems like a very unwise deal that could be dangerous for the town.
@@mdhazeldine It seems like, in this case at least, that if this town asked those questions, then another one that didn’t would’ve gotten the deal. I think the only way these problems stop starting is when all towns are asking those questions. But it only takes one Mayor with a “just say yes” campaign to keep the cycle going.
I think this is another one of those uphill battles where it takes all of us to push together to win.
@@b_dawg_17 remember the AMAZON HQ2.0 "bidding war" FROM 10? years ago where cities and counties climbed over each other to out cut taxes and build infrastructure
Oh that was the mayor of St Thomas? That explains a lot. I had the same thought, "what a naive approach"
@@aether388 Volkswagen knows how much capitalist politicians will fall over themselves to claim they created some jobs.
@@aether388 Joe isn't naive, a couple roads and a sewage plant we'd need anyway within 7 years is a small price to pay for a large manufacturer. If anything the province and country have a larger stake in the game.
The city I lived in before had a deal with IBM where the city purchased a massive building that they agreed to lease to IBM for $1 per year over 15 years. From what I remember, they also promised ~$55K annual average salaries and 800 permanent positions at the company during that time.
I don't think they ever hit the 800 number, their average wage was a bit below the proposed $55K and that was before there were more layoffs at the site and then eventually IBM just left town entirely.
I can only imagine how much money was spent to attract a company that measured their worth in billions and promised the world, but underdelivered...
Volkswagen has less freedom than IBM to get up and leave because they’re doing manufacturing, rather than tech. Doesn’t mean they can’t. In Australia, GM shut down Holden despite massive government grants to keep it going.
What's bugging me is that there are so many abbandoned industrial areas, especially in the west of the US that could be reused. I understand that local governments are forced to attract businesses, but this must not be this way. Cities shouldn't be forced to fight against each other like this. It's about the wellbeeing of humanity as a whole and not just of their own people
TBH they are those areas in Canada too. Hamilton (just 1hour away from this town) has several abandoned steel plants in the industrial area that ought to have been reused for this plant. Those sites are also connected to a large port which would enable shipping of goods in/out via the great lakes or by rail rather than by road. However, Hamilton did not vote for either the provincial nor federal government (they vote for the 3rd party in recent elections) so gets almost no investment.
@@agilemind6241 As far as the capitalist government parties are concerned the profit needs of the bosses come first.
The whole point of selling shares in a company was that it was a means by which companies could raise investment capital to allow the company to grow. They had to make a convincing argument to attract investors though, because the investors were using their personal money and knew they stood to lose it all investing in something stupid.
Something is seriously wrong with an economic system that allows companies to use their profits to buy back their own shares (Which used to be illegal) while petitioning governments to use taxpayers' money (Rather than their own, which they care about a lot more - especially since most of these companies aren't above a bit of bribery), to pay for the expansion of private companies. That this expansion usually comes without any government ownership of the company, mandatory sharing of profits or massive penalty clauses if the development doesn't deliver to the local economy as promised, is even more shameful.
Capitalism has taken on all the bad parts of communism while forgetting that the benefits are also supposed to be shared. In a world where we literally just saw that less than 0.1% of a billionaire's personal wealth is enough to buy the government of the biggest economy on the planet, this shouldn't surprise anyone at this stage, but boy should it make them angry.
I’ve been asking these risk-hedging questions myself for years. Why are government officials willing to trust pinky promises by corporations to spend millions without any concrete hedge against breaking their promises? It seems like something Chuck would have talked about so there’s got to be something going on that allows us to stupidly accept all the risk & give all the rewards to the private companies (AKA non-citizen people).
The distributist ideas pioneered by Chesterton and Belloc seem rather appealing right now.
I believe a few people have written about how this is the inevitable result of capitalism ~
@@ttopero Absolutely, this is what I do not understand anymore. Companies routinely put in guaranteed revenue clauses into contracts with governments, so why aren't governments doing the same? If a company wants a gov't to build them X infrastructure, they should guarantee Y tax revenue to pay for it once the plant is operational. If they fail to deliver the company is has to pay fees equivalent to the shortfall in tax revenue.
@@mikemoore-hehim1149 Marx pointed out the instability in capitalism, its tendency to concentrate wealth, its disregard for workers except as productive units, not 'owning' their work output. Extracting a 'rent' by owning a resource. For 40 years, wealth has been extracted rather than distributed. Workers are progressively poorer. Private capital buys up businesses, delists them from the stock exchange, load with debt, extract wealth, and ultimately, sell off. And the huge accumulation means corporations can 'buy' governments.
Why does a public municipal project for a city have need for NDAs for financing?
That's a weird concept for what's supposed to be public projects.
Kinda weird. Do you suppose it serves the benefit of the company more than the interest of those who live there? Things should be more transparent.
Insane. Towns are like we'll give you the land, water, power etc... and we don't even know what company we're prostrating ourselves for?
Funny watching this from a town (Chattanooga, TN) where we have a huge Volkswagen plant. We sunk lots of money into infrastructure and deferred millions in tax revenue, seems worth it now but not sure how the numbers will work out in the end. But we are less precarious than St. Thomas because we are much larger (city/county has 183k/383k people vs 43k)
The plant is a 25 minute drive from London ON, (450k people)
And keep in mind how risky it could be. If that plant was shuttered early, it's a pure net loss. And even if it gets through the initial payoff phase, there's still a lot of maintenance liabilities that depend on that factory sticking around
My childhood family car was made there, 2002 Passat. My parents still drive it! My 2017 Jetta was made in Mexico, sadly.
We should note the behaviours of Volkswagen in Germany. Wolfsburg is a city basically run by Volkswagen, and it’s a success story.
@@Descriptor413 Government regulations are pushing EVs and manufacturers are now making them. If the Trump admin changes the rules, that’s a big risk.
The production value on this is insane.
Glad you can appreciate it! ♥️
@@AnaGomez-tz2io Milan ?
Has the town developed a specific plan for how to accommodate the growth it expects? Is that plan consistent with Strong Towns principles? It would be a shame if they bet the farm on this EV plant in a way that leads to growth that undermines the long-term resilience of the community (similar to what has occurred elsewhere throughout North America).
I'm a planner who lives not too far from St Thomas. From a quick look at their planning docs, I'd say no.
Being a former railway town, they have this beautiful right-of-way parallel to downtown that leads directly to the new factory. Absolutely unbeatable candidate for light rail or a DMU/EMU train.
Unfortunately, I suspect they will completely miss the opportunity to preserve the space for higher order transit, and go all in on cars. Then complain about traffic. 'Tis the Ontario way.
@@mattr0103 who OWNS the right of ways and I assume the 2 MAJOR road expansions will also spur NEW town growth along it for factory workers to move to
I assume it will be 100% sprawl based detached homes as that is what "people want" when moving to a SMALL town for a factory job
@@mattr0103 Train is overkill for that corridor, and there is no planning trouble here. We will probably do a bike path there and dense housing. You can get from one side of town to the other on a bike in less than 10 minutes.
@@jasonriddell It's not sprawl (other than stuff built 1970-2010), look at 2/3 new subdivisions in St. Thomas and you will see it is more than 50% townhouses and semis and apartments.
I remember that all the claims about this ev battery plant were being made about musks proposed lithium gigafactory like 15 years ago and they all fell completely flat.
Okay, but think longer term than that. In 50 years, will the Tesla factory still be going? When one industry dominates the employment of a town, the wellbeing of the town is determined by the success of the company.
@@JohnFromAccounting problem is this town LIKE thousands LOST its main employer and is morphing into an EXURB of TO and towns of NOTHING but houses and shopping is NOT very financially viable and in this day and age there is NEAR ZERO chance of having a home grown hero along with other mid sized business move TO your town when there market is up the highway along with there suppliers and clients
Building "Just one more lane, bro!", rather than, say, a light rail line, to connect to "fake London", seems a missed opportunity. I wonder what @NotJustBikes thinks of this project, and this video
Probably just still glad he moved away, on top of all the other reasons well ahead of it
A light rail line would be a similarly huge and risky bet, though.
There used to be a rail line from London, actually! bUt ObvIOUsLy It wAs tOrn OUt OncE cArs tOOk OvEr
@@pdblouinif it connected the two cities & also connected the plant, it doesn’t seem like as big of a gamble as building one to a new subdivision in hopes of creating demand for the houses
@@pdblouin not really. If we were to treat rail lines the same way we treat highways as a transportation route that doesn't need to generate revenue, but building and maintaining them with tax dollars is necessary for economic development. Unlike multi lane highways they are cheaper to build, maintain and they help pay for their maintenance unlike highways unless you slap toll booths on tjem
Watching this while living in Skellefteå, Sweden and working at the (floundering) EV battery plant here and just thinking, "oh god, oh no"
Oh boy. We can build giant battery factories to try to force this electric car thing through, overbuild infrastructure that can't be maintained in the future, and call it an opportunity. Trains and transit would have a much better impact, but we're brainwashed.
I agree with you, but it will take many decades to phase out cars. For the mean time, cars will be around.
"force this electric car thing through"
@ it’s not that I don’t believe electric cars could never surpass ICE, but I’m a little surprised at how quickly they’re trying to make it happen, and the lengths industry and governments are going to.
There had better be some major battery technology breakthroughs, because there is no way to create as many electric cars right now as ICE cars thay currently exist. The materials can’t be sourced. Cars have also become insanely expensive.
This channel is primarily centred around alternatives to building sprawling environments, so its naturally going to lean more towards alternatives to passenger vehicles anyway.
@@JohnFromAccounting tbh that assumes a certain direction. If we invest hard enough in real alternatives to cars, then it doesn't take decades
Trains and transit need to connect people to economic development to be productive. They are a booster, rather than a replacement, to said development.
I'm not against cities growing and being successful, but none of this sounds like Strong Town's principles. Sounds like this town is destined for suburban sprawl, big box stores and parking lots as far as the eye can see. I really hope that isn't the case, but none of this video covers how this town is preventing that future from happening.
the town is already becoming a commuter exurb and the plant will attract NEW people to the region looking to buy a detached home and "LOW" traffic congestion and likely that will be true and widely available WHEN THE PLANT OPENS
@@jasonriddell Seems to be that every new and upcoming town is like that now. Like there seems to be only 2 ways to grow a city: commuter exurb or heavy gentrification. I'm tired of those two being the only options. I really try to stay optimistic, but it feels like even Strong Towns is losing their ways. I feel like the only way to fix this problem is to change the tax system. Like Georgism seems to be the only thing that gives me hope nowadays.
Wonderful content aside (seriously, love it) you may want to consider filtering the high frequencies out of the tubeTV-turns-on sound effect in the intro card for each section of the video. It's a very accurate sample - in that the pets and myself were surprised by that dreadful loud, barely-perceptible screech several times. I thought I was going crazy for a minute.
Seconding this
History: those who don't know it are doomed to repeat it.
Problem is that's not just a warning to gullible idiots. it's also a tip to scammers.
Here's a simple idea that could save cities from the total cost burden of these projects if they fail to materialize. I think if a large corporation is planning/asking/agreeing to bring a massive project to a town/city, it should be contractually obligated to cover some, if not all, of the infrastructure improvement, should they back out of the deal? For example, Foxconn should have been on the hook for at least a percentage of the cost Mount Pleasant invested to bring them to town.
There’s got to be a reason government officials accept all the risks on our behalf & give all the rewards to the private enterprise to be extracted from the community. I don’t know why we can’t get equity in exchange for the obligation we incur
That would be better, but the company is the one with negotiating power here. Why would they take that risk of being liable, when there are a dozen other towns that are willing to fund the infrastructure themselves?
Corporations are able to operate on an international scale and choose from whoever gives the best deal, while municipalities just don't have that kind of bargaining power. There would need to be national or international regulation on this kind of thing in order to force corporations to stop getting away with this.
@@Sahil-oq8ki bingo would need to take NON "free market" friendly steps like nationalizing that level of development AND likely tariffs FOR companies that DONT build in the country
They did sue to try to recover some of their costs but I am not sure if they won.
We read a really interesting paper in grad school this semester on 3 large coal mines in B.C.after being built and operated for a few years, only 59% of forecasted employment and 34%(!) Of tax revenue materialized. We need to do a very, very thorough job of vetting these "big bet" developments if they go in, and perhaps focus on smaller, more local and accountable businesses. Are these big companies creating wealth or siphoning it?
This probably is a blind spot for most politicians. It seems that greed & nepotism shows up when they get a sample of power-like a drug they can’t avoid & instantly addicted!
You are right on the money with that one
@@ttopero would NOT go that far and look at "simple" politics
voters usually care about 2 things 1 THERE JOB and 2 being able to CONSUME MORE then before
and "landing" a HUGE employer will win on BOTH FRONTS
@ I’d say it’s a learned cultural characteristic that has been systematically imprinted on us for decades if not centuries. We can choose a different way to get our needs met without giving up our soul
Well, across the globe there is an even shinier example
Soviet Union build towns upside down:
First, in a middle of nowhere, usually in desert, or tundra, a huge factory employing tens or even hundreds of thousands of employees is being built
Second, a lot of population - across the ethnic republics usually - is forcefully moved to live in a city built around the factory
Then, it collapses, factories gets bankrupt, 80-95% of population leaves the city
And I was living in one of them as well
The unfortunate news for St. Thomas is that we are quickly coming to understand that large scale battery manufacturing isn't sustainable or even needed. Applying it to personal vehicles larger than bikes just isn't feasible, and applying it to busses and trains is much worse than just installing overhead lines.
Tell that to President Musk
@eeesti216 Even he can't change the economics and physics of the situation.
If I may make a suggestion, can the tinnitus pitch be removed from the transition scene sound? Listening on an earbud that sound is borderline painful if the rest of the audio is loud enough to be understandable. Loving the video otherwise! I come from a smaller town that went through losing manufacturing in my lifetime so I find the subject matter and discussions fascinating
I never thought I'd see a Strong Towns episode done for my hometown! I saw the thumbnail and title and thought, this sounds like a similar situation St. Thomas is in, and sure enough, its literally about my town!
I've played enough games of Cities: Skylines to know what happens when you overbuild infrastructure without any tax base. It's not rocket surgery. It's just math.
Why can public officials managing taxpayer money in deals with private companies be silenced by an NDA??
Main problem- *if the plant ever comes, they already have all the leverage, and every level of government is eating out of their hands. All future town plans and tax money, who do you think will be directing them?
the national government has placed a 100% tariff on Chinese EV cars AFTER BYD was looking to open up in Canada to "protect" the Canadian battery "ecosystem"
so consumers are blocked from better and cheaper electric cars to protect these companies before they offer ANYTHING into the market
this from the same government pushing for ALL cars to be electric and has a carbon tax in place to "help" the transition
so before these plants have done anything they have already gotten the government to make there stated goal a harder reach
So, small town resident here. An actual small town (~6000 people), not a small city large enough for agencies like HUD to consider it urban.
This isn't what we want. It's not that we don't want manufacturing jobs, some of those would be great, we don't want to become company towns fully dependent on a single business or industry to thrive. We also don't really want to grow our infrastructure, at least not haphazardly.
ANY factory of scale would double your town but in this case this is not 10 percent of the regions population and less then 20 percent of the TOWNS population and the town WAS a factory town before FORD left so this is more of a return to form for the region
@@jasonriddell right. A gigafactory would be dystopian here. Even a factory that might employ 500-600 people would be "too many eggs in one basket" for our local economy, at least in my opinion.
It's not that we wouldn't want industry, just not the sort of industry that would redefine a community.
How fascinating, I've been working recently on the rail crossings that will be located on this site. I must admit, I don't know much about the project beyond this little element, but it's fascinating to see a video about a project I've been involved with on a whole.
why in the world is a municipality allowed to be restricted by an NDA about its spending??
This topic reminds me of a local development near myself-the Panasonic battery plant in DeSoto, KS. My fear is that it will promote more suburban sprawl that eventually spans all the way from Lawrence to Kansas City
Yeah i think in addition to the debt, these mega sites kind of upend the traditional development pattern by putting all the jobs decentralized out in the middle of nowehere
Very, very true. This script actually initially started with shuttle bus talk and quickly grew to everything else you see in this video.
Cities and Towns plus state and federal should be investing in nonprofit worker cooperatives instead of giving all this money to large greedy useless corporations
In other words, major corporations have figured out how to offload the risk of development, two cities and have them take on all the debt for the project. The company still may suffer some inconvenience if the factory work out or they change their minds, but the town has taken it on massive debt and it’s committed itself, probably communities around it to this particular path which states somehow deeded to justify with income in the future. Because we live in a world where the highest urgency is to re-localize in order to become resilient against supply chain disruptions, which will be a feature creasing a feature of our futures because of extreme weather we need a very different outlook. Tells that commit to giga factories are committing to the global supply chain. The global supply chain is increasingly subjected to ever higher more intense forms of disruption and risk.
On top of this, these giga factories are the process of climate change large scale projects represent energy intensification. The larger they are the more hierarchical they are and the higher their energy intensity, this bloats energy use. You can’t get away from it. You caught energy intensity and use by re-localizing.
We need to look only at Ingolstadt, Stuttgart and Wolfsburg for examples of cities that were transformed by one industry and are still going very strong. Germany faced enormous post-war economic struggle, and auto industry manufacturing was able to rebuild many cities. North America is not in the same position, but I think it’s more likely that St Thomas will succeed. It won’t be true for every location.
German cities have real city structure and are not just huge carpets of single family sprawl 😊
Here's to hoping! I'm seriously and rooting for St Thomas. Like, I literally want them to succeed because "them" are everyday people and I want the best for people.
Love the case study paired with interviews
Back in the early 80s, in Brantford Ont, we had Massey and White farm in town, by early 1986, they were both gone. in 1988, my then-wife's uncle sold his farm and some cash, came into Brantford and purchased 23 houses.. That is how depressed it was. But in the years they have brought many factories, mostly food type factories, like the folks from Italy, who are Ferraro. And many others, you drive through their new industrial area and there are like 50 plants there
"Due to collapse in our EV sales from fires caused by our competitors' vehicles' shoddy, tofu dreg construction, Volkswagen will not be operating its Saint Thomas EV battery production plant and will seek a full property tax abatement."
more likely "VW goes bankrupt - bailed out my union / German government on the condition ALL VW production moves to GERMANY and VW battery Canada is NOW "bankrupt" and wont continue with this project"
North star battery also building out in Ontario has gone bankrupt in Sweden but right NEW promises continued production
a battery anode refining plant in BC Canada is being "withdrawn" due to "hostilities" towards CHINA
Makes me think of velocity of money, for example you go to bakers and buy a loaf of bread, the baker goes to the mill owner to buy more flour, the mill owner goes to the farmer etc your single dollar circulated through all those people. There was a place called "black wall street" which had such high velocity of money that a dollar in the community would stay in the community for a year and get exchanged an average of 25 times. Whereas now in black communities in the US a dollar stays in the local economy for an average of 16 minutes and is not exchanged once.
@@Alex-cw3rz there’s an episode of Bluey about that.
For the 'Black Wall Street', are you referring to Tulsa and what happened May 31-June 1, 1921?
@@toddkes5890 unfortunately that did happen. But obviously this is referring before it was burnt down by ra cists.
The updated phrase might be ejection velocity or velocity of extraction
1:21 The logo for St. Thomas is perfect. It depicts the town being hit by a tsunami.
That's not our logo, that's Elgin County's logo, and there is no danger of a tsunami.
@@eeesti216 0:16 Well then it’s going catch fire.
I hope everything turns out well for St. Thomas. VW is having serious financial problems. The Chinese EV’s are less expensive and the quality is high. China leads the world in EV sales. They are also the leaders in battery technology. Even Tesla uses their batteries.
VW will do everything to avoid falling on their own sword, including abandoning commitments that are not profitable.
it can be great if they do it intelligently i.e. integrating quality of life features like rail/train transit, walkable neighborhoods, frequent grocery stores etc into the new development
if its just "here's some roads and a factory, and here's 5,000 mcmansions and condos off one giant cul-de-sac enclave with one lane leading out of it that has no shopping inside it at all" it'll be terrible
This reminds me of a chapter from the book Soccernomics. They discuss why cities beg private companies to come in and build stadiums and host big sporting events. They even give these corporations big tax breaks and financial incentives using our tax money.
These companies take government money (the taxes that we pay) to construct these stadiums and take a lot of the profit as well. If the stadium succeeds then the company profits, if the stadium fails then the local city suffers more than the companies. So it's a win-lose scenario here.
The only true benefit of hosting a big event is the "emotional happiness" but not financial success. We enjoy following an event if it's happening in our hometown and if our team does well. But that's pretty much it.
Do you know if there are any plans in St. Thomas regarding:
1. changing zoning laws to allow something else besides SFH, 2. removal of minimum parking requirements and 3. investments towards protected bike lanes and public transport, instead of just more lanes for cars?
I ask the mayor a bit about that in my long-form interview that'll be coming out for ST members. I do ask about if there will be any way to access the EV plant by bicycles and other means, other than driving. That'll be out in the next week or so, I believe.
@@BenDurham any answer for the public on it you are willing to share
@@jasonriddell Because it's very complicated, and I don't want to copy/paste literally 40 minutes of transcript, which wouldn't help anyone? 🤣
@@jasonriddell but if you want me to try, here are my answers: 1. I believe they're adding density to downtown and I'm excited about that.
2. I'm not sure if they'll be removing minimum parking requirements,
3. I don't think they're moving forward as fast as they should when considering alternative modes of transportation.
@@BenDurham My new subdivision in St. Thomas is more than 50% townhouses, a couple semis and an apartment building.
Whats the current guide lines on "leap frogging" development like this? I understand the pit falls, benefits and best practices for housing developments but not industrial developments. How are they different from large housing developments and how can affect their local town. Can they bring in the large plant then work to pay of their debt and strengthen their town from another bust cycle?
I don’t know, this one feels different to me than the typical “build the infrastructure and then hope development shows up to pay for it” model of suburban sprawl. You’ve got a solid company looking to build a plant to serve future (rather than past) needs, and they have specific infrastructure requirements. Yes, it’s huge and yes there’s risk, but it’s spread across the municipal, provincial, and federal levels. The only real difference between this and the small bets you prefer is that this is big. It’s a gutsy move and I hope it pays off!
youtube has been hiding this and the previous video from my subscriptions, if I hadn't seen a short of the vid being out I wouldn't even know
For the fact it destroyed valuable farmland in one of the warmest parts of Canada is astoundingly stupid
Sometimes farming is not the most effective use of the land.
@@JohnFromAccounting regional food production is more important than effective usage, and due to climate change now more then ever. You cant eat money. This land can never be turned into farmland again. Good quality farmland should stay farmland.
Thanks to all the suburbs a lot of farmland is being lost
@@kingbeam80ify Both batteries and food can be shipped long distances. It makes the most sense to evaluate each individual piece of land to determine if it's better off as a farm or a battery factory. It doesn't matter specifically where the food/batteries are produced as long as they are located reasonable close to transportation infrastructure.
The question “is it worth it?” completely depends on what the town does with the revenue. Do they use it to subsidize suburban development to support housing demand, or do they invest in a creating a desirable, livable small city that can still sustain itself if the industry leaves?
"We couldn't ask questions because we were under non-disclosure agreements".. That's not how that works..
Huh, that's a good point. I think they might've meant that the "higher levels" were under NDAs, so they couldn't get that information at their lower levels.
But still a good point.
I don't like big factories because no company should employ more than 5% of the working population. That's not a resilient economy. Moreover, while infrastructure debt isn't inherently bad, I don't think humans are ever very good at predicting how things are gonna play out and what will or won't play out.
9:22 oooh, Fake London! That's a nice crossover
The Urbanism Universe is growing and needs its plot points connected 🤣
@@BenDurham St. Thomas is way better than London.
@ Care to elaborate? I think both are great in their own ways :)
@@BenDurham I'll elaborate if you cover the US's Inflation Reduction Act which is the only reason Canada had to put up so much money for this. You can look at the billions spent in Michigan, Tennessee, etc.
While all you say is true, the landscape has changed dramatically over the last 50 years. A hundred years ago, no company would have needed a single plant this size, they would have started small and ramped up slowly. The current landscape doe not allow for this any longer. Next point is that building something this big would cost way more closer to a big city that could handle the investment. You have these issues around the world, for example, when Intel said they build a factory in Germany that never happened. The biggest plus for this project is that VW needs a battery plant badly to keep up with the future and since VW still is the second largest car manufacturer in the world with a revenue of $340 Billion, it is very unlikely that a project that is already in development, will be canceled.
@@gloofisearch I don’t think I’d say it being in development for VW makes it “likely” to happen. If anything, those things make the project less likely to happen. VW is in deep, deeeep financial shit atm. I’m taking to the point it’s a question as to whether or not there will even be a VW in 10 yrs time. Half of its revenue & almost all of its growth was concentrated in the Chinese market. That’s gone. They’ll be lucky if they sell enough cars in China just to keep the lights on. And that market ain’t coming back. Their sales in the US have been in free fall the last few years & never truly recovered from “Dieselgate” before that. The electric car market in the US is beyond saturated & likely won’t come back until EV prices drop considerably &/ or battery capacity/ range roughly doubles. On top of that, the only reason they would build a battery plant in the US is to qualify for American EV subsidies & avoid possible tariffs. The tariff component is still there, but EV subsidies are likely going away. Even the rosiest projections predict VW won’t sell enough EVs in the US to break even. Those have VW rocket to the top of EV sales by manufacturer. In all likelihood, reality will see the opposite. VW’s electric vehicles have consistently ranked dead last in class by range. I’m talking their top end, extended range models often boasting a 150 mile range vs 250-400+ miles from competitors. Did I mention VW has become notorious for poor reliability over the last few years? Even lifelong VW customers are being forced to reluctantly call it quits on the brand. It’s really, really bad. And they aren’t the only European brand struggling. All of them are in dire straits. That means lots of competition for bailouts. It doesn’t take an MBA to see they aren’t going to be able to open that plant.
@@williambrasky3891 there are CHINESE cars that WITH a 100% tariff are a BETTER value then VW "ID" cars and they are ONLY getting cheaper and better as more and more of the world buy them
The city + province are spending $100,000,000 on new infrastructure, which will last ~30 years. The mayor says they do not expect tax revenue for 5 years, which leaves 25 years. So the infrastructure building cost of $4,000,000, per year, plus cost of maintenance, plus interest. At 3,000 jobs, the cost equals $1,333 per job per year minimum. However, like the tax revenues, the jobs would also ramp up and possibly down in a recession.
Moreover, EV sales world wide is down. If the 3,000 jobs only last 10 years, that’s spending 100,000,00 to get 30,000 job-years, or $3,300 infrastructure spending per job-year.
EV sales world wide are actually up.
I always wonder about those infrastructure spending figures - are the politicians hiding the real cost in other budget chapters or are they doing the opposite by including stuff that would have to be done anyway.
I will predict that this EV battery plant will never actually open or if it dones it will be at a greatly reduced volume.
Governments are pushing EVs but the car buying public has most said no thanks.
Government subsidies are causing a false signal to the market and this is why we end up the these kind of projects that in the end the taxpayers is the only one left holding the bag.
Tell that to President Musk. The Public won't have a choice, EVs are cheaper to make and the investments are already being made internationally (despite how expensive they are to the consumer). If they are the only thing for sale, everyone will move on.
Very interesting! Thanks for making this!!
a debt based monetary system is the bane of modern society
Would suck if VW changed their mind and cxld the project. Would St Thomas be on the hook then for all these up front expenses? Why don't these companies contribute to these up front costs?
As a resident of ST.... Good reporting , having worked in Ottawa b4 retiring here I'm surprised how much time you spend on mechanic of the govt funding.... No question , plant will be more-balled at least , during the up coming ' tariff war's ...and I suspect cancelled it CDU..takes the German election coming.
IF ..you thing PPee...can save the deal ...I have a bridge for sale....???
In my city of 45,000, the words largest yogurt factory (chobani) was built like 10 years ago. And then just a couple years ago they built the biggest cliff bar factory right next to it. I don’t know how cliff bar is but the owner of chobani is actually a very good person giving away a ton to the community. Donates to teachers and is currently building a park. I guess he started in New York and somehow made his way up.
It is however a problem that chobani uses way more water than allowed. Idaho is one of the biggest water consumers and I think that may be why he came here because he could get away with it. Not sure though
Given their focus, I can see why things might work out a bit differently.
I'm about to say something very controversial; the opinions represented in this video are closer to "conservative" as discussed by Edmund Burke. Spoiler he was a conservative debating Thomas Pain in a series of articles during the French Revolution, neither of which are important what is however is his view. To summarize and overly simplify his argument as well as using urban planning as an example. He may liken the gigafactory implementation as short sighted and irresponsible as well as potentially deadly for the residents of the city. He could push it to state that the elected officials are being grossly negligent by chasing after something other than the immediate well being of their constituents for something that could and likely would cause grave damage to them in the future for little to no reward for any one but a select few.
Burke was a fan of slow and steady change even if it meant there would be many great opportunities that would pass the state by, because those that work are vastly outnumbered by those that do not. It's different if a private citizen takes the chance or a company, a government should not.
Edit I'd love a video that discusses the incremental development of towns as it used to be done. it's difficult to find that on youtube, may have to look on brilliant.
Strong Towns IS a conservative movement. Chuck Marohn expresses conservative opinions all the time. Do these line up with equitable outcomes even for the most liberal people because of how efficiently cities must be built to accommodate this thinking and elevate tax receipts? Sure. But yeah, Strong Towns has opposed many things that aren't incremental outcomes provided exclusively by and for municipal governments or its people
Regarding your video request: Chuck has several videos describing the iterative development of Brainerd, his home town. Check the older presentations to cities.
What we don’t hear about is how do we do the next iteration now when we’ve created a place to a finished state & still have debt/expenses on existing infrastructure even if we replaced & updated/upgraded it. Before the last iteration, each one created a whole other level of quality improvement & wealth/value growth as it was replacing something of much cheaper & lesser quality value.
@@ttopero Thanks I'll check it out. I am writing a novel right now and knowing this would make for better world building.
trust me - many of us would love US conservatism to go back to "fiscal responsibility" and not bs about social issues just to get more power to big business
@@mikemoore-hehim1149 It's all about the GDP. Gotta get that GDP up. More is always better. Lie about that figure if you need to and ignore the consequences.
"The economy is actually doing great guys, because GDP is WAY up"
Really appreciate the Canada focus of this video!
Interesting though that VW had the option to pull out even though local and national governments were already investing in expanding infrastructure for their benefit.
I enjoyed the look into this development in St Thomas but I think the video kind of went off the rails in the 17:30 segment. Out of nowhere you jump into making spooky insinuations about ponzi schemes and the spectre of debt without even once touching upon the concept of wealth creation, which is the critical element that separates a ponzi scheme from a sound, prudent investment, and what pays for the future costs of taking on debt. This is exactly what "doing the math" is about: comparing the value of the potential wealth creation against the cost of servicing the debt necessary to achieve it, factoring in the risk of lower (or higher) returns, and it's almost inexcusable that you pay lip service to "doing the math" without even attempting to explain to the viewer how that math may or may not end up adding up.
in a grander scale we DONT help EV production come to canada and watch as the CHINESE take over the market and look at the knock on job losses as the rest of the gas car plants close as they CANT compete against the better and cheaper Chinese brands so at that "scale" what is the risk / reward look like
No one plays Cities Skylines and only zones one industry building
It is naïve to think that satellite operations would be safe when the core business operations is having troubles.
I think the huge difference is 3,000 salaries (if that ever pans out) is something, but where did 99.9% of the revenue go, it was all taken out of the local economy.
Even with that amount of salaries, for a local economy it can be difficult to recoup those costs. The reason is with more people comes more costs unless you increase density generally. Add to the mix that if your tax revenues do go up and costs don't, people will bitch about paying so much in tax and paying so much in interest. Cities need to stop doing this shit. The costs never recoup. Take the 80 million loan. Let's say they get 3k extra tax payers. Even if every single person moved and lived in st Thomas, it's equivalent to 27k per person just to cover the loan principle. All the while corresponding service costs will go up and less of the money taken in actually goes to services but just services the debt. I will be shocked if this pays for itself 🙄. If we are gonna do shit like this we should get a piece of the pie. If companies are gonna do this maybe we should get a percentage of sales or whatever. Ffs you could pay 3k people to move to st Thomas for 26k each and probably create more benefit in doing so.
@@Donthaveacowbra if you have 3k people directly working in the plant you end up having another 3k people that are doing contract type work for the plant. You also have people that are making a fairly high income who are spending that money in the city which supports other businesses growth.
@@Donthaveacowbra math gets harder
first 3K direct jobs equals 3 to 4K NEW consumers to the local businesses and all the support jobs and businesses add even more
plus "support" businesses like NEW schools and hospitals and grocery stores
in Germany ONE VW factory worker is worth 4 NON factory jobs
I really live strong towns and repeat 99% of what you say, but, while im not from St. Thomas, as an Ontario resident I am very much in favor of this project. I can accept the argument the plant should have been in Oshawa or Sault St. Marie or Hamilton Or Windsor etc.
But the reality is we desperately need to pull investment. Ontario's economy is so heavily based on Auto Manufacturing, and I have very little confidence we will maintain that role over 20 years as ICE engines decline. We already struggle to keep these industries, and its not just jobs, and not just well paying jobs for a subset of the population that doesn't have white collar transferable skills, its our balance of trade and currency stability. There is a reason this was driven by the Federal and Provincial government, its far more important than municipal level.
But more then that, we talk about a few km of highway here. But what jobs are in St. Thomas? How much of the community is commuting to London and making demands on highways?
And also, it has to be noted that unlike the US, municipal debt is under written by the province, and province provide transfers to municipalities. So this isn't being forced on them alone.
I get this could go wrong and Volkswagen could pull out. Tariff threats don't help with that. But we desperately need a return of industry on an enormous scale because our existing industrial base, and potentially all those industries that feed into it, are on the way out. Not taking a risk here is like not risking swirving off the highway while you drive toward a frieght truck.
Is VW even going to be in business in 5 years?
With how big the German car lobby is, I don’t doubt it.
@@JohnFromAccounting USA / JAPAN / and GERMANY will be wiped out economically of there car manufacturing goes under we are seeing US apply huge tariffs and other import LAWS against Chinese EV makers and Europe is trying the same and Japan "forced" Honda to buy out Nissan to prevent FOXCONN from buying them whole
look at American steel / Nippon steel" being blocked and American steel is about to fail into bankruptcy without Nippon buying them
It's a battery plant. It will still have utility to another auto manufacturer if VW isn't around.
Really hard to know if it's a good idea without knowing the contract details. If you have that information, it's a simple calculation to determine the ROI, IRR, or payback period. And what amount of debt is the city actually under? What are the payment terms? Sorry, it's all MBA stuff and very boring but necessary!
Not exactly as the direct contract won't even come close to paying off the loans they take out. Usually it's "we will make it up in increased tax revenue". If cities bend over backwards to get a company to come they have to keep doing it else they threaten to leave. Same thing happens with sports teams. You stop this by either getting a piece of the pie, unions, or a mix of other things.
wow the information asymmetry problem would be easy to solve if all the information was available, any other frigid takes?
also what is the economic shape of the area as FORD closed a plant a few years ago - un employment / abandoned homes ETC
@@Donthaveacowbra there is the 1 to 3 jobs created for every factory job so there is the widening of the tax base and what is the current POST FORD economic shape like
Why is this so difficult? If your product requires subsidy then it is too big. If you can’t openly reveal your finance structure then it is corrupt. If your start-up cannot demonstrate solvency then it will not work at scale. These are not difficult questions to ask.
not sure if it is good to have all eggs in one basket.... one company to rule them all, oh different topic... no, really i know 300 jobs can be build at once, but also gone at once... local small businesses can create also jobs...
Given the recent issues with VWs move to electric cars, these folks are toast. This level of infrastructure requires up front cash from the companies involves to mitigate the risk, at least 50% or more to prove they are serious. Since no one is giving you any numbers, it is pretty clear that VW can walk away from this if "Economic conditions" change. Right now hybrids are still doing OK, but pure electric is not doing very well due to lack of charging infrastructure discouraging buyers from taking the leap. I doubt that the town put any conditions on their infrastructure work being reimbursed from the province if VW walked, that was a mistake as well on their side. Basically if your spending all the money up front, you are the sucker in this game.
The first generation of VW EVs was a disaster, but the next one is expected to do much better. VW read the market wrong.
recheck sales CHARTS EV sales as a whole are going up in EVERY MARKET outside of GERMANY and Canada is over 15% EV right now and is climbing with Quebec and BC being over 30%
Mexico is talking about tariffs on CHINESE EVs to fall in line with Canada and the current USA levels opening up Mexico to EV batteries made in Canada
VW themselves are in DIRE SHAPE IN GERMANY because of being all but closed out of CHINA and sub par EVs and software BUT every foreign OEM NOT NAMED Tesla is all but dead in CHINA right now as there is 150 car makers all in a BLOODY price war
If the people pay for the company, then why do the people work for the company rather than that company providing for the people? The people do not owe the company free labor, and if your income pays your employer to pay you, then you act part owner as a tax payer. Basically, the people own the government, so all the government investments in must pay back the people or they can take it from the former owner who can't afford to repay the investors.
The EV bubble will burst before this factory even opens.
If the town is going to get maintenance responsibility without the guarantee of the tax revenue to support it, it's almost certainly not a good deal to make deals with an employer. You can't assume the workers will be paying taxes there.
"Yes is the answer, what's the question?"
Wow , I cannot imagine a more dangerous motto/policy for a city. REAL easy way to get swindled.
Remember this is Doug Ford territory :D Corruption can't be far behind.
You should also cover Brownsville, TX receiving SpaceX and government investment as well
Having one major business or industry in a small town is always a recipe for disaster. Great for a while but industries always shift and not all towns can reinvent themselves. Something to be said about a diversity of jobs and employers and not relying on only one main player. Eggs all in one basket kind of thing. When the jobs and people leave it is hard to have the city/town revenue from taxes to improve infrastructure and quality of life for those who remain.
how do you "build" a lot of small to medium NON SELF SERVING businesses and not loosing them to far bigger markets fake London up the autoroute has 5X the market size and Toronto has 100X the market size AND all the suppliers are support businesses so how do you keep them from NOT going to the far batter markets
@ by that logic why would anyone not open a business in the biggest market possible? Why bother with any other city if it isn’t Toronto? That is flawed logic. People setup business in the communities in which they live at the time. The real question is how cities can incentives people to move and setup small the medium sized business in the community? How to make them thrive.
I am aware that large and huge size companies setup along highways and train lines, but that is due to size and logistics that aren’t factors for small to medium sized companies.
Volkswagen... doomed to failure. What a waste of taxpayers $$
Widening the roads and subsidizing corporations is a major fail.
The audio effects in the transitions are really grating.
Also why are you saying "Strong Towns says" in a video that is being produced by Strong Towns? It just seems weird and too self-interested.
11:56 Yooo, Canada's Wonderland? 👀
Yessss! Got my wife to film some Christmas Day highway footage on our way back home after the holidays haha
@BenDurham hopefully next time y'all go by the area you're able to "get aome footage" from the inside as well (even if that means just walking) ;p
Did these guys talk to Pleasant Prairie WI?
And how many factory closings have meant the decline of small towns?
How will the company repay the tax payers to regain full ownership of the company they invested in? I know the pay the employees reseve is for labor, so non of that is applicable. Also, how does a government make non disclosure agreements work? How do you get the voting population of a city to be trusted to not talk about something? That's thousands of people, and if you don't tell them it's only money from the negotiators, as the tax payers must know the content of NDAs to use there funds. Doing so without that information means you are taking a loan out to be repaired to them in your own name.
Interesting video.
why did y'all add the high pitch transition noise? It's annoying and takes away from the fantastic content you're producing
Dang it! Do you happen to be listening to the video on 2x speed? Just attempting to troubleshoot this.
Because I know the SFX that you're referring to, seeing as I added it into the many layers that make up that transition sound. But at regular speed, it seems fine. But I now hear it when listening at 2x times speed, unfortunately 😬
@@BenDurham I’m also getting the high pitch noise with normal speed but watching from a TV
Welp, gosh darnit. It past by a bunch of people - including myself - and it didn't get flagged. I've learned my lesson about mixing those high pitched sounds in. Just wish I could fix it now that it's live.
Sorry about your ears 😢
Oh this is Strong Towns and not More Perfect Union. I was wondering why there was so little anti-capitalist messaging here
Yeah ST hasn't quite completed the journey yet.
The high-pitched beeping sound on the section title cards hurts. Please remove it next time!
100% for sure! Unfortunately didn't catch it before release 😢
Some small towns don’t have a choice in this matter. Rather than natural growth, there is definite shrinkage and without a big employer the town will slowly die off
First rule of acquisition: once you get their money, never give it back.
I'm halfway through the video, and despite being familiar with Strong Towns, I still don't understand what the issue is
Ow! The high-pitched sound used in the transitions hurts, can you use a different sound please!
Gave me whiplash this isn’t on Ben’s channel
better to have people unemployed and hopeless, rather than working. you know, for the sake of urbanism
Hi Ben
Wonder what would have happened if they just bought $80 million in lottery tickets.
Nothing but a loss. Bitcoin, on the other hand.
Title suggestion, "Big Factories Do Not Help Small Towns"
Be direct and clear, titles are so wonky these days. I always want to know exactly what the video is about before I click. Your title was clear to people who already watch your videos, but some people might really think the opposite so a vague stance on the video might allow them to more easily ignore it. A lot of the title doesn't even show up on my screen in the feed. Short clear titles are everything imo