Yahoo Finance Windsor picked for new $5B EV battery plant
Automaker Stellantis and South Korean battery giant LG Energy Solution are forming a joint venture to open a new electric vehicle battery production plant in Windsor, Ont.
The joint venture will invest $5 billion to establish a new lithium-ion battery manufacturing plant in Windsor that will supply "a significant portion" of Stellantis' North American vehicle production with batteries.
Construction of the plant is scheduled to begin later this year, and production is expected to start in the first quarter of 2024.
"This is the largest automotive manufacturing investment in the history of our province," Ontario Premier Doug Ford said at a press conference in Windsor on Wednesday.
"This game-changing battery plant will help guarantee that Ontario is at the forefront of the electric vehicle revolution and ensure we remain a global leader in auto manufacturing, just as we have been for over 100 years."
Ford was joined in Windsor by Ontario Economic Development Minister Vic Fedeli, federal Minister of Innovation François-Philippe Champagne, federal Transport Minister Omar Alghabra and Windsor Mayor Drew Dilkens, as well as executives from Stellantis and LG Energy Solution.
The federal, provincial and municipal governments have agreed to support the joint venture. While the governments did not specify how much support will be provided from each, Ford confirmed that Ontario and Canada are "putting hundreds of millions of dollars in." According to a news release, more details of the agreement will provided once due diligence is completed.
Stellantis said that the plant will have an annual production capacity of 45 gigawatt hours of batteries and will create an estimated 2,500 jobs in Windsor. Stellantis' chief operating officer for North America Mark Stewart says the Windsor plant will be the first of two that the company will build in North America. An announcement for the second plant, which will be in the U.S., will be made in the coming weeks.
"Our joint venture with LG Energy Solution is yet another stepping stone to achieving our aggressive electrification roadmap in the region aimed at hitting 50 per cent of battery electric vehicle sales in the US and Canada by the end of the decade,” Carlos Tavares, Stellantis CEO, said in a news release.
LG Energy Solution owns 51 per cent of the joint venture and Stellantis owns 49 per cent, the South Korean battery maker said in a regulatory filing. LG Energy Solution has its own factory in Michigan and two battery join ventures with General Motors in Ohio and Tennessee.
Dilkens says the investment will be "transformational" for the Windsor-Essex region.
"We have lived through the ups and downs of the automotive industry," Dilkens said.
"This is transformational... This is one of the largest investments in Windsor's history in a century."
The new joint venture is the latest investment related to electric vehicle production made in Canada over the last several months.
Last week Honda Canada announced it will spend $1.38 billion to upgrade its Alliston, Ont. plant to produce the 2023 CR-V hybrid crossover. The federal and provincial governments pitched in $131.6 million each towards the plant upgrade.
General Motors and South Korea's Posco Chemical announced earlier in March that the companies will invest $400 million to build a new facility in Quebec to produce cathode active materials to power GM's electric vehicles.
Ford also said it will invest $1.8 billion to retool its Oakville assembly plant to build battery electric vehicles. Fiat Chrysler Automotive, which is owned by Stellantis, has also committed to spending between $1.35 billion and $1.5 billion upgrading its Windsor assembly plant to produce electric vehicles.
With files from Reuters
Alicja Siekierska is a senior reporter at Yahoo Finance Canada. Follow her on Twitter @alicjawithaj.
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