Stellantis & LG ES to build battery factory in Canada
Stellantis and LG Energy Solution have unveiled plans to build a large electric vehicle battery manufacturing facility in Canada. A joint venture is to be set up to produce battery cells and modules at the new factory in Windsor in the Canadian province of Ontario.
These battery modules from Ontario will cover “a large part of Stellantis’ production needs in North America”, as the carmaker writes. The battery factory is expected to offer an annual production capacity of over 45 GWh and create around 2,500 new jobs in Windsor and the surrounding area. Construction is set to begin this year, with production scheduled to start in the first quarter of 2024.
What production capacity is planned for commissioning and when the final expansion of 45 GWh is to be reached is not clear from the announcement. The exact supply chain for the raw materials and intermediate products is also not mentioned. However, Stellantis and LGES say they expect “the new battery factory to serve as a catalyst for building a strong battery supply chain in the region”. This means that as much as possible will be sourced locally.
According to Stellantis, the joint venture will invest over 5 billion Canadian dollars (equivalent to 3.6 billion euros) – the exact distribution of shares and investments is not mentioned. Should it be a 50:50 joint venture, both the carmaker and the battery manufacturer would invest about 1.8 billion euros each.
“Our joint venture with LG Energy Solution is yet another stepping stone to achieving our aggressive electrification roadmap in the region aimed at hitting 50% of battery electric vehicle sales in the US and Canada by the end of the decade,” said Stellantis CEO Carlos Tavares. “We are grateful to the Municipal, Provincial and Federal levels of government for their support and commitment to help position Canada as a North American leader in the production of electric vehicle batteries.”
At ‘EV Day’ in the summer of 2021, Stellantis had announced that in the US, performance brand Dodge will launch its first electric muscle car in 2024, Ram will sell an electric version of the 1500 in 2024 – as an electric pickup. The Jeep Wagoneer will be an all-electric premium SUV aimed primarily at the US market. At the time, however, there were lower e-sales targets for North America, and the 50 per cent by 2030 that Tavares talked about was only announced earlier this month.
“Through this joint venture, LG Energy Solution will be able to position itself as a critical player in building green energy value chains in the region,” said Youngsoo Kwon, CEO of LG Energy Solution. The announcement also features Canada’s Prime Minister Justin Trudeau. “Today’s announcement of a world leading facility to build electric vehicle batteries in Windsor is an investment in our workers, our communities and our future. Partnerships like these are critical to creating new jobs and putting Canada on the cutting edge of the clean economy,” he said.
The day before, Stellantis had also announced another battery manufacturing project in Europe: The ACC joint venture – consisting of TotalEnergies, Stellantis and Mercedes-Benz – will convert Stellantis’ Italian engine plant Termoli into a cell factory. In this context, it was also announced that the previously planned ACC factories in Douvrin and Kaiserslautern will be expanded from 24 GWH to 40 GWh, bringing ACC’s target to 120 GWh by 2030.
The latest announcement for Ontario brings LGES’ planned production capacity in North America to 200 GWh already, which should be enough for more than 2.5 million electric cars. In total, the Korean compmany will invest 4.6 billion US dollars in battery plants in North America.