Stellantis demands billions in subsidies to keep planned battery plant in Canada
Jeep-maker Stellantis has threatened to shift a planned battery plant from Canada to the US unless it receives billions more in state subsidies offered to a rival, in the latest manoeuvre by a big manufacturer in the international battle over green incentives.
It comes as the world’s fourth biggest carmaker, which also produces Vauxhall/Opel, Fiat, Citroën, Peugeot, DS, Alfa Romeo, Maserati and Abarth vehicles, leads a campaign in Europe for the UK and EU to renegotiate tariff rules in the Brexit deal.
Stellantis and the South Korean electronics maker LG announced plans in March last year to build a C$5bn (£3bn) electric-vehicle “gigafactory” in the city of Windsor, Ontario, an investment that received nearly C$1bn in subsidies from the federal and provincial governments.
The factory opening date was set for 2024, with the deal touted by the governing Liberal party as a key win in luring multinational automakers to the country.
Months later, the US passed the Inflation Reduction Act, promising generous subsidies for battery production. In April this year, Ottawa matched incentives offered under the IRA in order to secure a deal with Volkswagen for a sprawling battery plant in St Thomas, Ontario, with subsidies that could cost as much as C$13bn over the next decade.
Now, Stellantis has demanded similar benefits from Canada, warning that otherwise it will move production to the US.
Canada’s prime minister, Justin Trudeau, and industry minister, François-Philippe Champagne, were in the South Korea capital on Wednesday in an attempt to salvage the plans. Champagne has called on Ontario to add more money to pay its “fair share” in order to rescue the deal.
“Trust me, it’s very difficult to attract these investments,” he told
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