Question Period Note: STELLANTIS-lges BATTERY PLANT

• The automotive industry is crucial to the Canadian economy and to the hundreds of thousands of Canadian workers it supports.
• As the automotive industry globally shifts towards production of zero-emission vehicles, the Government aims to attract manufacturing investments in key areas like mineral extracting and processing, cell manufacturing, battery materials and components and zero-emission vehicle manufacturing.
• Companies are making decisions now to determine investment locations and failure to act could result in the loss of Canada as a destination for these investments.
• With respect to the battery facility being built in Windsor by Stellantis and LG Energy Solution, the Government of Canada continues to negotiate in good faith with the companies and the Government of Ontario regarding production support similar to what is provided in the United States. We are committed to taking actions needed to remain competitive.
• The government’s top priority remains getting the best deal for Canadians - one that creates jobs, promotes growth and investment in the automotive sector, anchors supply chains, and supports the shift to a net-zero economy.

• Since early 2022, the government has attracted large anchor investments in battery material processing and cell manufacturing, including:
o PowerCo (Volkswagen Group): Investment of up to $7 billion for a cell manufacturing plant in St. Thomas, Ontario;
o GM/POSCO: $500 million to produce cathode active materials in Bécancour, Quebec; and,
o Umicore: $1.5 billion for a battery materials plant in Loyalist, Ontario.
• In March 2022, LG Energy Solution (LGES) and Stellantis announced that their joint cell manufacturing project, NextStar Energy, would be established in Windsor, Ontario. The NextStar Energy project would feed Stellantis’ battery demand in North America (including its Canadian operations in Windsor and Brampton), with a production capacity of 45 GWh in St. Thomas, Ontario. Negotiations regarding production-based support from government are ongoing.
• In 2022, Canada’s automotive manufacturing sector contributed nearly (CAD) $14 billion to Canada’s Gross Domestic Production (GDP) and directly employed over 125,000 Canadians, of which approximately 100,000 are located in Ontario. Canada’s automotive sector is anchored by the presence of five original equipment manufacturers (OEMs); Stellantis, Ford, General Motors (GM), Toyota, and Honda, which operate a combined eight vehicle assembly plants in Ontario, and collectively produced 1.2 million light vehicles in 2022.
• Beyond the OEMs, there is a significant cluster of over 600 automotive suppliers in Canada, the vast majority of which are located in Southern Ontario due to the importance of being geographically positioned to serve OEM customers in Ontario and the Great Lakes region in the United States (U.S.)
• Jurisdictions across North America are competing for production mandates for zero emission vehicles and its battery supply chain. The U.S. is pulling significant investments across the new automotive value chain through subsidies offered through the Inflation Reduction Act (IRA), as well as through other investment incentives offered by state and local jurisdictions.
• In many countries, major automakers are pivoting to building electric vehicles at historic speeds. That is why the government is investing in the battery value chain through industrial policy measures that provide access to critical minerals and incentives to attract battery manufacturing companies, as well as through supporting battery research and development.
• Canada is the only nation in the Western hemisphere with the critical minerals (lithium, nickel, cobalt, and graphite) needed for battery manufacturing. This, along with the government’s commitment to support clean technologies, and battery manufacturing facilities will cement Canada’s position in the EV supply chain.
• The Government’s approach in building a battery ecosystem leverages strategic advantages in natural resources and critical minerals, and connects that advantage to Canada’s advanced manufacturing base. The emerging battery ecosystem will be an integral part of Canada’s continued strength in automotive production and its transition to electrification.
• Canada has been able to attract several landmark investments in zero-emission vehicle production and battery manufacturing, with the support of the Strategic Innovation (SIF) and the SIF Net Zero Accelerator (NZA) including: Stellantis, Ford, GM, and Volkswagen. The NZA supports Canada's net zero goals to help transform the economy for clean and long term growth. This initiative will provide up to $8 billion in support of projects that will enable Canada to reduce its domestic greenhouse gas emissions, including to establish a battery ecosystem.

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