jetcityimage/iStock Editorial via Getty Images
Canada’s government said Thursday it agreed to dole out as much as C$15B (~US$11.3B) in incentives to Stellantis (NYSE:STLA) for an electric vehicle battery plant, topping the C$13B in state aid over a decade previously offered to Volkswagen (OTCPK:VWAGY) for a similar plant.
The deal ended a standoff that began in May when the automaker stopped construction on the project, demanding Canada match support available in the U.S. under the Inflation Reduction Act.
The Stellantis (STLA) plant, built in partnership with South Korea’s LG Energy, will be located in Ontario, whose provincial government earlier agreed to pick up a third of the cost, which also will extend to the Volkswagen (OTCPK:VWAGY) project.
Production at the Stellantis (STLA) plant is expected to begin in 2024, creating ~2,500 new jobs and targeting an annual production capacity of more than 45 GWh.
The deal’s performance incentives are contingent on and proportionate to the production and sale of batteries from each project, and could be canceled or reduced if incentives offered under the U.S. IRA are reduced or canceled.
Separately, Stellantis (STLA) said it signed a deal with NioCorp Developments (NASDAQ:NB) for the supply of rare earth elements used to produce high-powered magnets for its electric vehicles; financial and production details were not disclosed.
More on Stellantis:
