Construction of the Stellantis battery plant in Windsor, Ontario will resume following an agreement between the manufacturer and LG and the Canadian government.
In mid-May, Stellantis confirmed that work had stopped on the site of its new battery plant for electric vehicles in Windsor. The company stated at the time that “As the Canadian government has not lived up to what was agreed, Stellantis and LG Energy Solution (LGES) will begin to implement their contingency plans. Effective immediately, all construction activities related to battery module production at the Windsor site have been halted.”
Just under two months later, the impasse is over. Stellantis has announced resumption of construction at its plant.
NextStar Energy, the vehicle battery joint venture between Stellantis and LG Energy Solution, has signed a binding agreement that secures the future of battery cell and module production in Windsor, Ontario, and honours commitments made by the Canadian government to level the playing field with the U.S. Inflation Reduction Act (IRA).
Mark Stewart, Stellantis COO for North America, had this to say about the agreement:
“The IRA fundamentally changed the landscape for battery production in North America, making it challenging to produce competitively priced, state-of-the-art batteries in Canada without an equivalent level of support from government. We are pleased that the Federal government with the support of the Provincial government came back and met their commitment of leveling the playing field with the IRA. This collective effort enabled the deal to close and we are now resuming construction on the site in Windsor. We are very grateful to the governments for their leadership to resolve and bring this deal to fruition, as well as Lana Payne and her team from Unifor for tirelessly advocating alongside us in our shared commitment to protecting thousands of new jobs as we achieve our electrified future propelled by our Dare Forward 2030 strategic plan.”
Dong-Myung Kim, president and head of the Advanced Automotive Battery Division of LG Energy Solution, issued a separate statement:
“It’s a good day not only for our joint venture but also for Canada. We are happy to finally move forward with building the country’s first major battery plant and be a central part of the local battery ecosystem. We are grateful to the Federal and Provincial government for working together, and to everyone who worked tirelessly to get this deal done.”
Danies Lee, CEO of NextStar Energy, was no less enthusiastic:
“Thanks to the agreement and continuous support from the Windsor community, NextStar Energy can now focus on what we do best,” said Danies Lee, CEO of NextStar Energy. “We will soon produce state-of-the-art batteries here in Windsor, and we’re excited to grow and thrive with the community.”
NextStar Energy is one of eight battery factories that LGES has secured in North America to cater to the growing electric vehicle market.
Construction has now been relaunched after a break of around 50 days. Actual production at the plant is scheduled to start sometime in 2024. The plant is targeting an annual production capacity of over 45 gigawatt-hours. In all, 2,500 new jobs will be created in Windsor and surrounding areas.
For workers in the region and for the Ontario economy, this is obviously good news and a cause for relief.