Stellantis and LG Energy Solutions have reached a deal to continue the construction of the NextStar Battery plant in Windsor, the company confirmed Wednesday.
Construction has resumed, the company said in a statement Wednesday evening. It’s not yet clear how much money is involved in the deal.
“We are pleased that the federal government with the support of the provincial government came back and met their commitment of leveling the playing field with the [Inflation Reduction Act],” said Mark Stewart, Stellantis chief operating officer North America.
It’s been more than seven weeks since we learned the future of the electric vehicle (EV) battery plant being built in Windsor, Ont., was in jeopardy.
Now, the company confirms an agreement has been reached to keep the facility in the southwestern Ontario city.
Earlier this month, Stellantis and the federal government confirmed the automaker and LG Energy Solution received an offer from Ottawa, and their financial and legal teams were mulling it over.
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Prime Minister Justin Trudeau said the offer was “respectful to taxpayers” and would create “great jobs” for generations to come to secure a future in communities across southern Ontario.
Last month, Stellantis said it was moving to “contingency plans” because the federal government wasn’t honouring its agreement. That’s when the automaker stopped most of its construction at the site.
Word of a tentative deal being reached was first reported by the Toronto Star on May 31.
Canada’s financial package with another automaker, Volkswagen, which plans to open a massive factory in St. Thomas, Ont., was believed to be connected to the impasse, according to industry experts, as was new U.S. legislation that enables unprecedented incentive offers for companies — something Canada could have difficulty matching.
Premier Doug Ford said Ontario would be covering one-third of the cost of an agreement and he didn’t believe giving Stellantis more was setting a bad bargaining precedent for the province.
The exact breakdown of the deal, and how much it’s worth, is still unknown.
South Korean battery-maker LG Energy Solution and Stellantis announced the $5-billion project last year, and said it was expected to create 2,500 jobs and open sometime in 2024.
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More to come