What was supposed to be the first electric vehicle battery plant in Canada is now on idle because of a dispute between Stellantis and the Canadian government.
All construction related to the facility, which began last summer, is suspended until further notice.
Stellantis, maker of Chrysler, Jeep, Dodge and Ram vehicles, teamed up with South Korea’s LG Energy Solution for the joint venture battery factory in Windsor, Ontario. The goal was to start operations in the first quarter of 2024, with an annual capacity of at least 45 GWh, making the site one of the largest EV battery factories in North America.
The project, which represents a total investment of more than $5 billion, needs financial support from all three levels of the government, including about $500 million from Ottawa. However, Stellantis claims Justin Trudeau’s administration has failed to deliver on what was agreed to, without getting into specifics.
Per CBC, negotiations in good faith between the two parties are ongoing. At the same time, the automaker and his partner have made it known that they’re working on backup plans.
Windsor Mayor Drew Dilkens also blamed the federal government in a recent post, saying it’s “jeopardizing not only the completion of the EV plant but also our efforts to attract additional investment to the region.”
The VW Effect
This comes a few weeks after Volkswagen announced a future battery factory in St. Thomas, Ontario, which is projected to cost around $7 billion. Ottawa will give the German automaker $700 million in addition to various incentives that could amount to $13 billion over 10 years.
The deal was spurred by the government’s desire to beat the Americans at their own game following the US Inflation Reduction Act that came into effect last year.
By the way, Stellantis has yet to say which EVs the batteries made in Windsor will go into, but Ram (1500 REV), Jeep (Recon) and Dodge (Charger Daytona SRT) are all prepared to launch highly anticipated models in 2024.