(OTTAWA) The federal and Ontario governments are jointly investing more than $1 billion to help automaker Stellantis retool its Canadian factories to manufacture electric vehicles.
Posted at 4:08 p.m.
Stellantis, the new company created a year ago by the merger of Fiat Chrysler and the French group PSA (ex-Peugeot-Citroën), is investing an additional 2.6 billion in its modernization projects in Ontario.
The federal government is investing $529 million and the Ontario government $513 million. Prime Ministers Justin Trudeau and Doug Ford were in Windsor on Monday to make the announcement.
This includes creating flexible assembly lines, at Stellantis factories in Windsor and Brampton, for the construction of battery electric and hybrid vehicles. Stellantis is also expanding its research and development center in Windsor, to include a battery testing center and an electric vehicle research center.
Last month, the two governments announced investments, of $259 million each, including to transform General Motors’ CAMI assembly plant in Ingersoll, which would become Canada’s first large-scale electric utility vehicle production facility. .
Federal Innovation Minister Francois-Philippe Champagne, who was also in Windsor on Monday, says this is an important vote of confidence in the Canadian auto sector. The Minister felt that we were currently witnessing a major change in the automotive sector and that the Canadian industry was a major player.
Last March, the two governments had also each promised nearly 190 million for the Honda plant in Alliston, in particular to modernize it in order to produce electric vehicles, precisely.
With 500,000 jobs and a $16 billion contribution to Canada’s GDP, the auto sector is a vital part of the Canadian economy, but it has been slow to adapt to the electric shift.
There are currently only a few “zero-emission vehicle” models rolling off Canadian assembly lines – the Chrysler Pacifica hybrid, made at the Stellantis plant in Windsor, as well as the Lexus RX 450 and Toyota RAV4 hybrids, all two manufactured at the Toyota plant in Cambridge, Ontario.
In March, Stellantis and LG Energy Solutions also announced a joint $5 billion investment to create Canada’s first-ever large-scale electric vehicle battery production plant in Ontario.
Minister Champagne said Monday that with the current uncertainty in supply chains and other global challenges, Stellantis’ decision to look to Canada for these investments is a big win.
“For me, that a company like Stellantis, which really had the choice of investing in Europe or North America and which decides to do so in Canada, is a major vote of confidence in our workers,” said he declared.
Stellantis would like half of its vehicles sold in North America to be electric by 2030.
Canada is aiming higher: Ottawa wants 20% of new vehicles sold to be “zero emissions” by 2026 and 60% by 2030. By 2035, Canada intends to ban the sale of new passenger vehicles with internal combustion engines. In 2021, electric vehicles exceeded 5% of the total number of new vehicles purchased in the country.
The federal government will soon announce details of a mandatory sales target for dealerships, which will include annual electric vehicle sales quotas — and financial penalties for those who don’t meet their targets.