Canadian Prime Minister Justin Trudeau’s government is unfairly demanding that Ontario pay more to subsidize an electric-vehicle battery plant at the “11th hour,” even after cutting provincial officials out of the negotiations, the province’s premier said.
(Bloomberg) — Canadian Prime Minister Justin Trudeau’s government is unfairly demanding that Ontario pay more to subsidize an electric-vehicle battery plant at the “11th hour,” even after cutting provincial officials out of the negotiations, the province’s premier said.
Stellantis NV halted construction on the facility in Windsor, Ontario, earlier this week after accusing Trudeau’s government of failing to provide the public money it had committed for the site. Trudeau’s ministers, in turn, said Ontario was refusing to pay its fair share of production subsidies.
Ontario Premier Doug Ford said on Wednesday that his office wasn’t a part of the negotiations that led to a February agreement to subsidize the plant.
“I’m just disappointed right now at the fact we weren’t involved — they never talked to us,” Ford told reporters on Wednesday. “At the 11th hour, they’re doing this.”
The province has committed its “fair share,” but the federal government is responsible for competing with the US on subsidies, Ford said.
“We’ll go toe-to-toe with any state,” he said, adding that Ontario is now at the table with the federal government and the companies.
The CEOs of Stellantis and partner LG Energy Solution Ltd. wrote in a letter to Trudeau last month that they were awaiting his government’s signature on a “special contribution agreement” that was finalized in February.
“The continued delay in executing this agreement is bringing significant risk to the project,” Carlos Tavares and Kwon Young-soo wrote, adding they may be soon forced to make “difficult decisions.”
The letter doesn’t contain details of the deal except that it was “mutually satisfactory,” and it adds that Canada has provided five written documents confirming its commitment to match incentives under the US Inflation Reduction Act.
Stellantis and LG announced the $4 billion project last year, but reopened talks with Canada for more public money after the IRA was passed. Trudeau’s government has already offered as much as C$13 billion ($9.6 billion) to Volkswagen AG to lure a vehicle-battery plant to Ontario.
Stellantis and LG said in a statement Wednesday that they are only asking the Canadian government to keep commitments it made in February.
“This uncertainty is unfair to our Canadian employees, as well as towards Stellantis and LGES investments,” the companies said.
Federal Trade Minister Mary Ng told reporters the negotiations are continuing and that “this government has kept its word.”
The 45 gigawatt-hour factory would create 2,500 jobs and supply Stellantis’s assembly plant in Windsor and others across North America. Stellantis has also warned of possible factory closures in the UK if the country doesn’t renegotiate its post-Brexit trade agreement with the European Union.
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