Here’s the Status of Major EV Battery Plants and Projects in Canada

Honda employees work along the vehicle assembly line before an event announcing plans for a Honda electric vehicle battery plant in Alliston, Ont., on April 25, 2024. The Canadian Press/Nathan Denette

Electric vehicles were considered the way of the future just five short years ago. Today, the demand for electric vehicles (EVs) and EV battery plants is waning both in Canada and globally due to a wide range of factors.

Some of the issues cited in consumer surveys on purchasing EVs include the substantial cost disparity between EVs and gas-powered vehicles, worries about their driving range, reliability in cold weather, and the availability of charging facilities. Along with the repercussions of increased interest rates and inflation, all factors have played a role in shaping consumer behaviour since 2020.

A consumer data report released in May 2024 by J.D. Power indicated that a notably smaller number of Canadians expressed interest in purchasing an electric vehicle compared to the year prior. Only 11 percent of new-vehicle shoppers in Canada say they are “very likely” to consider an EV for their next purchase, according to the report.

The drop in numbers indicates a significant shift from just a few years ago, when companies were eager to invest in the sector.

Several companies have announced a combined investment of $46 billion in EV-related projects in Canada since October 2020, with governments promising some $52 billion in assistance through subsidies for plant construction and production, along with tax credits, according to an estimate by the Parliamentary Budget Officer.

The plants, primarily located in Quebec and Ontario, include a diverse array of operations, from electric vehicle assembly facilities to those that process raw metals into the necessary chemicals for manufacturing battery cells.

A number of projects are encountering delays despite receiving billions in public subsidies, and the Liberal government initiatives introduced by former Prime Minister Justin Trudeau, which pledged to eliminate the sale of gas vehicles by 2035, are now uncertain.

Progress on many of the projects was minimal when Trudeau stepped down in March, with only a small portion of the anticipated $31 billion in federal funding having been allocated. This has sparked concern about the possibility of proposed electric vehicle projects being scaled back or cancelled, especially if consumer demand for EVs continues to dwindle.

As uncertainty about electric vehicles continues, here’s a look at the status of current and planned EV plants in Canada.

Stellantis-LG Energy Solution

The first large-scale battery operation in Canada started module production last fall at its plant in Windsor, Ont.

Known as the NextStar Energy facility, the $5 billion factory is a joint venture between Stellantis and LG Energy Solution and is expected to receive up to $15 billion in funding from federal and provincial governments. The amount it receives will be tied to the plant’s production capacity and employment targets.

The site is also projected to begin battery cell production by late 2025 to not only supply Stellantis plants but to be the foremost battery hub in North America, according to the company. Stellantis manufactures Chrysler, Ram, and Fiat vehicles.

Honda

Honda is building an EV manufacturing plant and a battery manufacturing facility in Alliston, Ont., as part of a multi-billion dollar supply chain plan.

Construction began last fall and the EV factory is scheduled to begin production in 2028. When fully operational, it will be able to produce 240,000 EVs annually while the battery manufacturing plant will have a capacity of 36 GW of batteries.

Honda’s EV factory footprint in Ontario will also comprise two additional parts: A cathode active material (CAM) plant and precursor cathode active material (pCAM) factory in a joint venture with Posco Chemicals and a separator factory in a joint venture with Asahi Kasei. CAM is a key component of lithium-ion batteries found in electric vehicles.

The plants will be key parts of the supply chain for Honda’s Alliston EV manufacturing facility.

Both the federal government and the province have committed to a $15 billion investment in the Japanese automotive manufacturer’s Ontario supply chain.

Posco Chemicals-Honda

​​Honda’s proposed full EV supply chain will include a new CAM/pCAM processing facility through a joint venture partnership with Korean battery materials company POSCO Future M Co., Ltd. This project is still in its infancy and the site of the future Ontario plant has yet to be made public. Honda hasn’t released additional information about the plant since it was announced last spring.

Asahi Kasei-Honda

Japanese company Asahi Kasei Corp. is currently constructing Canada’s first lithium ion battery separator plant in the Niagara region as a joint venture with Honda.

Construction on the $1.7 billion facility, which will produce a key component of EV batteries began last November in Port Colborne, Ont.

Commercial production at the plant is projected to start in 2027, pending the acquisition of permits and approvals from the relevant regulatory bodies.

The Port Colborne plant will receive federal support through the Clean Technology Manufacturing investment tax credit, according to a government press release. The tax credits are part of the roughly $2.5 billion in federal subsidies announced for Honda last year. The government of Ontario also pledged $2.5 billion in the form of “both direct and indirect incentives.”

Ford

Ford has scrapped its plan to manufacture EVs at its Oakville, Ont., assembly plant—at least for now—due to soft demand in the market. The plant had received matching $295 million investment pledges from the Ontario and federal governments.

The company had planned to spend $1.8 billion to turn the Oakville facility into a leading hub that would produce three-row electric SUVs beginning this year.

Ford last spring pushed the timeline back to 2027 to “allow for the consumer market for three-row EVs to further develop,” but has since changed course.

The American automaker now says the electric SUVs will be manufactured in another location, which has yet to be disclosed. The Oakville plant will instead be used to produce 100,000 gas-powered Super Duty trucks as of 2026.

The union representing Oakville’s workers said the plant will begin producing the next-generation Super Duty, including an electrified version of the pickup, “later in the decade.”

GM

GM Canada announced earlier this month that it would temporarily halt production at its electric vehicle facility in Ingersoll, Ont., citing insufficient demand for its EV products.

The facility, which opened at the end of 2022, was the country’s first full-scale electric vehicle manufacturing plant. The province earmarked $259 million in grants for the project with Ottawa promising to match the contribution.

The plant produces Chevrolet BrightDrop electric delivery vans and electric batteries for passenger vehicles. It started production on the vans in 2023.

The company said the current five-month shutdown will allow GM Canada to “rebalance” inventory. But it will also work on revamping the facility for production of the 2026 model year of commercial electric vehicles.

When production restarts in October, it will be on a single shift operation for the “foreseeable future,” leading to the “indefinite layoff” of nearly 500 workers, the union representing the employees said.

Umicore

Belgium company Umicore announced last summer it was putting its plans to build a $2.76 billion rechargeable battery manufacturing plant near Kingston, Ont., on hold due to declining demand for electric vehicles.

The move to halt construction of the Loyalist Township facility, located roughly 25 kilometres northwest of Kingston, came several months after the technology company received nearly $1 billion in grants from the Canadian and Ontario governments. It received roughly $551 million from Ottawa and $425 million from the province.

The plant was originally slated to start production in 2026 and was expected to create more than 600 direct jobs.

Umicore has since conducted a review of its battery materials business and released the results last month as a “roadmap to 2028.” The roadmap did not specify a timeline for the resumption of construction in Loyalist Township; rather, it seemed to suggest a distinct departure from any major investment in battery materials.

Volkswagen

Site preparation was completed on a 150-hectare property last fall in St. Thomas, Ont., to establish Volkswagen’s PowerCo battery plant.

The $7 billion gigafactory is set to manufacture batteries capable of powering one million electric vehicles annually. The plant, which was first announced in 2023, is the first EV battery cell gigafactory in North America with an industrial park projected to span an area of 850 football fields, according to the company website.

Ontario is providing $500 million in direct incentives to the company  while Ottawa has pledged to offer Volkswagen production assistance amounting to US$35 per kWh. Canada’s support will be contingent upon actual production and sales, and will decrease by 25 percentage points each year starting in 2030, with the credit being fully phased out after 2032.

Volkswagen has said the plant is expected to generate as many as 3,000 direct employment opportunities, along with numerous indirect jobs. The construction phase is expected to wrap up in 2027.

General Motors-Posco Future M

General Motors announced a joint venture with South Korean industrial materials maker POSCO Future M in 2022 to build a factory to make components for electric vehicle batteries in Bécancour, Que.

The $600 million plant, located about halfway between Montreal and Quebec City, was supposed to be up and running this year, creating an estimated 200 jobs, but that date has been pushed back to early 2026, GM says.

Quebec is lending the companies $152 million and pledged that $132 million would be forgiven if the factory maintains those jobs for at least a decade, Premier François Legault said in 2023. Ottawa also pledged to provide funding of up to $147 million.

The joint venture, known as Ultium CAM, will produce cathode active material once it’s up and running.

Northvolt

Ottawa and Quebec had announced support for Northvolt AB in September 2023 to build a multi-billion dollar EV battery plant near Montreal to produce batteries for one million electric vehicles annually.

But the Swedish battery maker announced earlier this year it had filed for bankruptcy in Sweden, noting that a court-appointed trustee and lenders would make decisions concerning its Canadian subsidiary.

It remains unclear how the company’s bankruptcy will affect the future of the Quebec plant, but the province said it has lost $270 million as a result of Northvolt’s financial downfall. The federal government, which also committed funding, has said it did not suffer any monetary losses.

Concerns regarding the future of Northvolt’s Quebec plant first emerged last summer when the company announced it was undertaking a strategic assessment of its expansion plans.

The construction of the first phase of the project was expected to begin in the fall of 2023 and the first operations were slated to begin in 2026, according to the company’s website. The company said the plant would create more than 3,000 jobs.

E-One Moli Energy

British Columbia energy company E-One Moli Energy suspended construction plans for its $1 billion expansion of its Maple Ridge lithium-ion battery factory last December, just one year after announcing the project.

The planned facility, located roughly 50 kilometres east of Vancouver, was to be the first of its kind in Western Canada to develop high-performance lithium-ion battery cells. Ottawa promised to chip in $970 million and the province $80 million as part of the project forecast to create 350 new jobs.

The current E-One Moli facility in Maple Ridge remains operational but the planned expansion project has been postponed by parent company Taiwan Cement Corp., citing a shift in focus toward production in Taiwan.

There has been no announcement about the possibility of construction in the future.