Three Reasons Why 'Danpungguk' Canada is Focused on Mobility: Energy, Minerals, and Workforce

Canada has emerged as a major hub for advanced mobility manufacturing, including electric vehicles and batteries, in North America.

There are currently 10 battery and electric vehicle plants either under construction or planned in Canada. Numerous companies, including Korean firms such as LG Energy Solution (battery cells), POSCO Future M (cathode materials), EcoPro BM (cathode materials), and Solus Advanced Materials (copper foil), as well as European battery companies like Northvolt (battery cells) and Umicore (cathode materials), are building factories in Canada. Ford, Stellantis, and Honda have also announced plans to build electric vehicle assembly plants.

Canada Attracts More Than 10 Advanced Mobility Plants

The regions where these plants are concentrated are around the Great Lakes (five massive lakes spanning the US and Canada) and the St. Lawrence River leading to the Atlantic Ocean. These areas are adjacent to US automotive industry hubs such as Detroit and Philadelphia, providing strong logistics advantages. Canada benefits from a geographic advantage that allows the completion of the electric vehicle supply chain from materials (cathode materials, copper foil, etc.) to components (battery cells) to finished products (electric vehicles).

Ontario, where many battery and electric vehicle plants are clustered, has grown its automotive industry in step with the US internal combustion engine vehicle industry. Windsor, located across the river from Detroit, has been the foundation of Canada’s automotive industry since the early 1900s. It prospered by supplying military goods during the two World Wars.

Canada, known as the "Maple Country" for its beautiful natural scenery, is also an "energy powerhouse." It has abundant reserves of natural gas and oil and is well-suited for renewable energy sources such as hydropower and wind power. This enables the production of cheap and eco-friendly energy. Canada accounts for 4% of global energy production, ranking as the world’s 6th largest energy producer. Last year, Canada’s total energy generation reached 640 TWh, with clean energy accounting for about 19%. Among clean energy sources, hydropower made up 61.3%, nuclear power 12.9%, non-renewable waste fuel 19%, wind power 6.1%, and solar power 0.5%. The Canadian government supported 320 clean and low-carbon energy projects last year with funding amounting to 114.441 trillion KRW. (Canada Natural Resources Department Energy Report)

Electricity Rates 20-30% Cheaper Than Korea and the US, Plus Eco-Friendly Energy Supply

The large-scale supply of eco-friendly energy is an attractive condition for establishing electric vehicle and battery plants that consume massive amounts of electricity. It can supply large-scale renewable energy to global companies constrained by RE100 (100% renewable energy use) and Europe’s carbon footprint regulations. Above all, electricity rates are low. Canada’s electricity rate is 85.45 KRW per kWh, which is 22% cheaper than Korea’s 109.80 KRW and 31% cheaper than the US’s 124.96 KRW. Ontario, where manufacturing is concentrated, relies on nuclear power for 60% of its total electricity, and of Canada’s 19 nuclear reactors, all but one are located in Ontario.

Ontario and Quebec, where major plants are concentrated, hold key raw materials for batteries. Canada is known to have deposits of 530,000 tons of lithium, 2.8 million tons of nickel, and 220,000 tons of cobalt. Local mining companies such as Electra, Avalon, and Snow Lake have both mining and processing capabilities. Electra operates North America’s only cobalt refinery in Sudbury, Ontario. According to BloombergNEF (BNEF)’s global battery supply chain assessment, Canada ranks second after China.

Labor costs are also about 70% of those in the US, reducing the burden. Ontario and other regions have many factory workers due to their long history of automobile production since the early 1900s. Currently, more than 100,000 people in the region work in the automotive industry. Additionally, provincial policies offer an average electricity rate reduction of over 15% for industrial sites, attracting manufacturers’ attention.

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