‘Unprecedented’ foreign investment in the country’s automotive sector creates jobs, encourages innovation and positions Canada as a world leader in rechargeable power sources
A little fuel for thought: By 2030, it’s estimated that half of all new vehicles sold in places such as the United States and Japan will be electric cars.
What do those new EVs need? Batteries, produced on a scale the world has never seen.
Enter Canada, which is making progress toward becoming one of the world’s leading suppliers of those highly in-demand rechargeable power sources. We have a long heritage of automobile manufacturing excellence: The first large-scale car factory opened in Windsor, Ont., in 1904, to make Model C Fords. Now, the Canadian sector contributes $16-billion to the country’s GDP and employs 500,000 people directly and indirectly, thanks to investment from five of the world’s key auto makers.
Automobile manufacturers have already made significant investments in the last two years alone to build electric vehicles here in Canada – this new investment brings it to the next level. Now we will have not just all the minerals that batteries for electric vehicles require, but also the expertise and the facilities to build those batteries here in Canada.”
It’s safe to say Canada knows its stuff when it comes to cars, and it has the robust infrastructure—including a strong supply chain—and the skilled workforce to prove it.
When it comes to manufacturing electric vehicle batteries, Canada has another key advantage: It’s the only country in the western hemisphere with a supply of the requisite mineral deposits—which include lithium, cobalt, manganese—needed to make EV batteries. According to a recent report by mining analyst Benchmark Mineral Intelligence, the demand for these raw materials is going to require 335 new mines to be built by 2035, which will not only create new jobs, but also support the development of a supply chain that spans from raw materials to established manufacturing.
This makes it the only western country that can actually deliver a true “start to finish” supply chain for EV batteries, increasingly important in an age of disruption, delay and concerns about global geopolitical stability.
“I think it’s what the consumer will want. People are moving to electric vehicles. At the same time, when you talk to consumers around the world, most want the greenest vehicle possible,” says François-Philippe Champagne, Canada’s minister for innovation, science and industry. “Our vision is to be producing right here in Canada the greenest vehicle you can find in the world, with green steel, green aluminum, green batteries, green semiconductors.”
That vision is taking shape, thanks to several significant foreign investments that have been announced this year. General Motors, for example, has partnered with South Korea’s POSCO Chemicals to invest $633-million in a cathode active materials plant, which is key to building an EV battery, in Bécancour, Que.
In Ontario, South Korea-based LG Energy Solution and Netherlands-based Stellantis have pledged to build a major EV manufacturing facility in Windsor, Ont. The investment is valued at $5-billion, and promises to create 2,500 well-paying jobs.
“Automobile manufacturers have already made significant investments in the last two years alone to build electric vehicles here in Canada – this new investment brings it to the next level,” says Laurel Broten, CEO of Invest In Canada, the country’s global investment attraction and promotion agency. “Now, in addition to having the critical resources, Canada will also have the expertise and the facilities to build those batteries here in Canada.”
Another key electric vehicle battery investment this year comes from Belgium-based Umicore, which has the intention to build an innovative EV battery plant in Loyalist, Ont., a small community of about 16,000 people located between Napanee and Kingston.
“The planned facility would be the first of its kind in North America, combining cathode and precursor material manufacturing at a large industrial scale and thereby completing the missing link in Canada’s battery value chain, from natural resources to electric mobility,” says Umicore’s CEO Mathias Miedreich. “I strongly believe the facility will help Canada and Umicore in our shared objective of achieving a carbon-neutral and regionally fully integrated battery materials value chain to support Canada, as well as our customers in their fast transformation toward sustainable electric mobility.”
Foreign direct investment is allowing Canada to build on one of its most important industries (automotive) and to broaden its horizon toward the electrification of transportation, support low-carbon alternatives and protect the environment for future generations.”
The plant, which will run entirely on renewable energy from the start of production, will employ 1,000 people in the construction phase. Once completed, it will create high-quality operations jobs for several hundred people.
Canada’s reputation for having highly skilled workers, particularly in the in-demand STEM fields, was a “critical advantage,” Miedrich says, adding that the company is committed to being a positive addition to the area. “Local employment and deeply rooted community relations are crucial for us to establish a sustainable co-existence between the local community and the company.”
Umicore was considering several locations for this plant, but chose Loyalist as the place it wanted to establish roots in Canada for the long-term because it offers ample amounts of clean energy, resources and skilled workers.
For Jim Hegadorn, Loyalist Township’s deputy mayor, the investment is a win-win. “This investment in our area, and particularly within Loyalist Township, will have a great impact on everything from skilled workers and the talent that’s needed, and they will be able to live and work within their communities.”
Broten notes that in 2021, Canada had its highest level of global direct investment in 15 years, and says 2022 has seen equally exciting progress in attracting partnerships that will ensure Canada’s continuing prosperity, including “unprecedented investment” in the automotive sector. “Foreign direct investment is allowing Canada to build on one of its most important industries (automotive) and to broaden its horizon toward the electrification of transportation, support low-carbon alternatives and protect the environment for future generations.”
It means a more prosperous and sustainable economy, and a social boost for Canadian communities just like this—powered by electric vehicle batteries, of course.