Ontario to Pay 1/3 of Incentives for Both Stellantis, VW Battery Plants

Ontario has agreed to an auto pact with the federal government, to pay not just one-third of the production incentives in a deal with Stellantis and LG Energy Solution but also for a Volkswagen battery plant.

Stellantis and LG stopped construction in May on a $5-billion electric vehicle battery facility in Windsor, Ont., as they pressed the federal government to match what the United States would offer under its new Inflation Reduction Act.

They announced Wednesday that they had reached a deal with Canada and Ontario, and those two governments say the agreement will see the companies receive performance incentives of up to $15 billion over about 10 years.

Ontario Premier Doug Ford announced in June that the province would agree to cover one-third of the production incentives, in addition to a $500-million capital commitment.

Today, the governments say that the cost-sharing agreement now also extends to production incentives for a Volkswagen electric vehicle battery facility in St. Thomas, Ont.

Volkswagen could receive up to $13 billion in incentives under its deal.