Trudeau Mute on Details Surrounding Stalled Stellantis Factory Deal

Prime Minister Justin Trudeau tours the Stellantis Windsor (Chrysler) Assembly plant in Windsor, Ont., Jan. 17, 2023. The Canadian Press/Nicole Osborne

Prime Minister Justin Trudeau did not provide details on the continuing negotiations with auto- and battery-maker Stellantis on June 2, saying work was “ongoing” to bring the new electric vehicle battery plant to Windsor, Ontario.

“Conversations are still ongoing with Stellantis, so I won’t get into details, but we will continue to make sure we’re getting the right deals for Canadians that create great jobs for the future in growing industries that are going to support communities,” Trudeau said during a press conference alongside Polish Prime Minister Mateusz Morawiecki.

On May 15, Stellantis announced it had paused negotiations on a proposed $5 billion electric vehicle battery plant because the federal government had failed to deliver on its promises.

“As of today, the Canadian government has not delivered on what was agreed to. Therefore, Stellantis and LG Energy Solution will begin implementing their contingency plans. Effective immediately, all construction related to the battery module production on the Windsor site has stopped,” the company said in a statement.

Ontario Premier Doug Ford claimed the federal government needed to support Stellantis in the same manner it did with auto-maker Volkswagen in providing $13 billion in subsidies and a $700 million grant to build an electric vehicle battery plant in St. Thomas, Ontario. Both the federal government and Ontario offered a $1-billion capital contribution when the factory was announced in March 2022.

On May 31, the Ontario government committed to paying a third of the cost of the Stellantis factory. Ford said the province and federal government were “inches” away from a deal with the company, and Ottawa needed to step up in a “huge, huge way” to finish it.

The same day, Industry Minister François-Philippe Champagne said the deal was “going well” and the two sides were “getting closer to the end of the negotiation.”

Volkswagen Plant

Trudeau said that over the past few years, Ottawa has worked “very closely” with the Ontario government to secure “billions of dollars worth of great middle-class jobs for Canadians, not just for today, but for generations to come. The prime minister said the ”world is paying attention“ to Canada’s supply chains, critical minerals sector, and the ”quality and reliability” of Canadian workers.

The federal government announced on March 13 that PowerCo, a subsidiary company of Volkswagen, would be building Volkswagen’s first overseas battery cell plant in St. Thomas, Ontario.

Trudeau cited the controversial deal as an example of an investment that would create “great jobs” for generations of Canadians.

“When we secure investments like this that are larger than just a single plan, that demonstrates a commitment to creating great jobs right across this country for decades to come ... that flies straight in the face of those who say that Canada is broken,” he said.

“The investments we’re making will return within five years of that plant’s operation and create, most importantly, great jobs in St. Thomas and across southern Ontario for decades, and generations.”