Canada to Provide $11.23 billion in Production Incentives for Stellantis-LG Energy Solution Electric Vehicle Battery Plant
Canada has announced that it will provide up to $11.23 billion in production incentives for the Stellantis-LG Energy Solution (LGES) electric vehicle battery plant. This comes after the companies recently announced that construction at their plant would resume. The production incentives offered to Stellantis and LGES are higher than the similar deal with Volkswagen that was announced in April. Canada is competing with the United States to attract major clean-tech projects.
The subsidies deal led to the resumption of construction at the Stellantis-LGES plant in Windsor, Ontario, which had been halted in May. The companies demanded that Canada match the support offered under the Inflation Reduction Act (IRA) in the United States. The federal and provincial governments said in a joint statement that this announcement will protect and create thousands of good-paying jobs and strengthen the clean economy. Canada aims to establish an end-to-end electric vehicle supply chain and attract companies involved in all levels of the EV supply chain, including battery production.
The funding for the battery plant will be provided by Canada’s federal government and the province of Ontario in a pact similar to the $13 billion deal for Volkswagen’s plant. The federal government will provide two-thirds of the funding, while the Ontario government will provide one-third, in response to the incentives offered by the U.S. government. Deputy Prime Minister Chrystia Freeland expressed gratitude to Ontario Premier Doug Ford for the province’s contribution and emphasized the importance of Canada securing its fair share of green jobs and investments.
Production at the Stellantis-LGES plant is scheduled to begin in 2024, with a target annual production capacity of over 45 gigawatt hours. The performance incentives are tied to the production and sale of batteries from each project, and may be subject to cancellation or reduction if the incentives offered by the U.S. IRA are altered. This investment in the EV battery plant is expected to drive the growth of Canada’s clean tech industry and contribute to the country’s efforts to reduce carbon emissions.
($1 = 1.3361 Canadian dollars)
READ: Stellantis CEO warns of more auto plant closures
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Omprakash Tiwary is a business writer who delves into the intricacies of the corporate world. With a focus on finance and economic landscape. He offers readers valuable insights into market trends, entrepreneurship, and economic developments.
Denial of responsibility! Samachar Central is an automatic aggregator of Global media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, and all materials to their authors. For any complaint, please reach us at – [email protected]. We will take necessary action within 24 hours.
