Ottawa reaches deal with Stellantis worth up to $16 billion, after months of tense negotiations over EV battery plant

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Automotive giant Stellantis has accepted a government offer to salvage a Windsor electric-vehicle battery plant after months of high-stakes talks drove Ottawa and Queen’s Park to ante up to $16 billion in richer subsidies.

OTTAWA—

“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,” said Mark Stewart, Stellantis’s chief operating officer for North America.

Ontario Economic Development Minister Vic Fedeli hailed the “historic auto pact,” which will see the province cover one-third of the subsidies with Ottawa on the hook for the rest. Flavio Volpe, president of the Automotive Parts Manufacturers’ Association, said if the deal had collapsed, it “would have scared away investments.”and that the future of the Windsor plant was up in the air.

“We knew the high stakes. We knew these commitments had to be kept because the alternative would have been unthinkable for so many workers,” said Payne, whose union also represents Toronto Star employees. When Stellantis sought matching subsidies from Ottawa, months of phone calls, overseas crisis talks, and written offers and counter-offers ensued.

As reported by the Star, the federal government first scrambled to distinguish between the two projects, saying the VW plant was meant to anchor an entire new supply chain, as behind the scenes Ottawa leaned on Queen’s Park to kick in more to prevent Stellantis from moving to a U.S. state.

 

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