2023-05-13 06:39:51
The Opel parent company Stellantis and the South Korean battery cell producer LG have announced that “emergency plans” for the construction of a battery plant for electric cars in Canada will take effect and have criticized Canada’s government. “As of today, the Canadian government has failed to meet its commitments. As such, Stellantis and LG Energy Solution will immediately begin implementing their contingency plans,” Stellantis said in a brief email on Friday (local time).
The reasons for this or the emergency plans mentioned were not discussed in detail. The companies announced last year that they would build a $3.7 billion EV battery manufacturing plant in Canada.
Stellantis and LG wanted to invest a share of around $1.48 billion. The federal and provincial governments are expected to make contributions of an undisclosed amount. But apparently the talks had stalled. As Canadian Finance Minister Chrystia Freeland explained, however, “good talks” are being held. “We’re working very, very hard (on the project) with Stellantis as a government, we’re very focused on it,” Freeland said in a call to reporters on Friday.
Threat of construction freeze
Like the Canadian newspaper Toronto Star Citing insiders, Stellantis reportedly threatened to halt construction of the plant unless the contract with the government was upgraded to the same level that Volkswagen received this year. Canada’s agreement with VW for a gigafactory for batteries is believed to be the largest single investment in the country’s electric vehicle supply chain to date.
Canada’s government had pledged to provide up to CA$13.2 billion (US$9.6 billion) in tax credits for production through 2032, while Europe’s largest automaker committed up to CA$7 billion to build the plant in St. Thomas, Ontario.
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