A new battery plant will be built south of London, Ont., by the world’s largest automaker
The German auto giant Volkswagen will build its first overseas battery plant in St. Thomas, Ontario.
A new battery plant will be built in a small community south of London, Ont., where the company’s battery subsidiary intends to begin production in 2027.
It is the world’s largest automaker. It announced last year that it was considering communities in Canada when it signed a memorandum of understanding with the government on battery materials, but Monday’s announcement confirms its commitment.
Volkswagen also announced it was scouting a site in South Carolina, saying it was about expanding its North American reach.
We will enter a key market for e-mobility and battery cell production with the expansion to North America,” said Thomas Schmall, a board member.
Considering our shared values of sustainability, responsibility, and cooperation, Canada and Ontario are perfect partners to scale up our battery business and green economy jobs. For the people of St. Thomas and Ontario, we are committed to being a reliable partner and good neighbor.
In the past year, the federal and provincial governments have paid billions to attract other battery companies and electric vehicle announcements, but no details of any financial deal were announced on Monday. The two governments confirmed last year they would provide financial assistance to the construction of a $5 billion Stelantis/LG battery plant in Windsor, but did not say how much taxpayer funds the plant will receive.
The move to Canada was made possible by Ottawa and Queen’s Park’s continued cooperation, according to Vic Fedeli, Ontario’s economic development minister.
In addition, Fedeli said Premier Doug Ford sat down with the company several times and that the investment could lead to future investments in mining in northern Ontario.
For the first time in 120 years, Northern Ontario will be included in the auto sector with the production of lithium hydroxide for lithium ion batteries.
The deal’s financial details and the amount of investment were not disclosed, but Fedeli said the most important thing is that the company has committed to Canada.
“What they wanted out was the fact that the competition was over. Ontario has won the competition for Volkswagen’s first overseas gigafactory,” he said. I will leave Volkswagen to explain what their gigafactory is. “I think the word gigafactory should make it clear that this is a very large plant.”
Two gigafactories have already been announced by Volkswagen: one in Salzgitter, Germany, and another in Valencia, Spain.
In 2025, the German plant will employ 2,500 people and produce enough batteries for 500,000 vehicles.
According to François-Philippe Champagne, the effort to lure the company began with a phone call.
The decision is a big vote of confidence for Canada. It’s a big vote of confidence for the auto industry and our workers as well.
Additionally, he believes it sets up the auto industry for long-term success.
A European manufacturer is coming to Canada for the first time in Canadian history and showing interest in Canada. It’s really a big deal for the auto sector in Canada,” he said. In my opinion, we have solidified the auto sector for generations to come.”
In addition, Flavio Volpe, president of the Automotive Parts Manufacturers’ Association, said that attracting another automaker to Canada would be significant for St. Thomas.
Ford and Sterling restructuring forced them to pull out of St. Thomas in 2010 and the town hasn’t been the same since.”