Stellantis and LG Energy Solution Battery Plant Investment Negotiations in Canada Hit Snag

Stellantis "Emergency Plan with LG Energy Solution"
Canada "Negotiations Underway"

On the 13th (local time), Bloomberg reported that Stellantis and LG Energy Solution are in conflict with the Canadian government over financial support for establishing an electric vehicle battery factory. A spokesperson for Stellantis stated in a press release the day before, "The Canadian government did not honor the agreement," and added, "Both companies will immediately activate contingency plans."

Last March, the two companies announced plans to establish a 45GWh battery joint venture factory in Windsor, Ontario, Canada. They planned to invest over $4 billion (approximately 5.4 trillion KRW), begin construction in the second half of this year, and start mass production in the first half of 2024.

Mark Stewart, COO of Stellantis (left), and Dongmyung Kim, Vice President and Head of the Automotive Battery Division at LG Energy Solution (right), are posing for a commemorative photo.
[Photo by LG Energy Solution]

The spokesperson for Fran?ois-Philippe Champagne, Canada's Minister of Innovation, Science and Economic Development, told Bloomberg that negotiations are still ongoing.

He emphasized, "The automotive industry is very important to the Canadian economy and to the hundreds of thousands of Canadian workers in the sector," adding, "This is why Minister Champagne has tirelessly worked to protect the future of Canada's automotive industry."

He continued, "We are negotiating with our partners in good faith," and explained, "Securing the best deal for Canadians is our top priority."

After the U.S. Inflation Reduction Act (IRA) was passed in August last year, the Canadian government promised financial support to enhance the competitiveness of Canadian manufacturing plants. In response, Volkswagen Group decided to build a battery factory in southern Ontario and receive financial support amounting to 13 billion Canadian dollars (approximately 12.8 trillion KRW).

This content was produced with the assistance of AI translation services.