South Korea’s Solus Advanced Materials Co. Ltd. is opening a new electric-vehicle battery materials plant in Quebec as it expands into North America, further cementing the province’s position as a hub for next-generation automotive manufacturing.
The new factory, to be launched by Solus’s Volta Energy Solutions subsidiary, will be located in Granby, Que., where it will produce copper foil for electric vehicles, the company said in a news release Tuesday. It will be the first such facility in Canada, and Solus’s first factory on the continent.
No financial terms of the investment were disclosed in the release, but the Quebec government said in its own statement that Volta’s project is valued at $750-million, and that it would create 260 jobs. Quebec is offering a partly forgivable loan to the company worth $150-million. Federal assistance hasn’t yet been finalized.
Solus chairman Dejae Chin said in the company’s statement that Quebec’s access to the North American market and its “strong political commitment to making electric vehicle battery production a key sector of its economy” mean the province is the “ideal location for Volta’s first North American factory.”
Battery copper foil is a key component of lithium ion batteries, one that helps increase the mileage of electric vehicles. Volta expects to start mass production of the material in 2026, to meet growing demand from customers in North America.
The company said it plans to produce 25,000 tons of foil a year in Quebec, increasing to 63,000 tons a year in a second phase expansion. The latter amount is enough for 2.5 million electric vehicles, it said.
Quebec has been pushing hard to make the province a hub for electric-vehicle battery development, luring companies with low-carbon hydroelectricity, and with financial backing in tandem with the federal government. Canada is seeking to compete with a U.S. cleantech industry that has been turbocharged over the past year by incentives that are part of U.S. President Joe Biden’s Inflation Reduction Act.
That legislation includes US$369-billion in funding for green energy and related technology, as well as electric vehicles and energy efficiency measures. Ottawa and provincial governments have responded with billions of dollars in public funding to lure battery makers and suppliers to Quebec and Ontario.
The effort has yielded private-sector commitments. But the ultimate benefit to taxpayers, which policy makers hope will come in the form of jobs and a strengthened industrial base, might not be clear for years.
South Korean companies have developed strong expertise in the electric-vehicle sector, and they have been among the most active in choosing Canada as a base of operations for selling into the North American market. In June, Stellantis NV and Seoul-based LG Energy Solution reached a deal with the Ontario and federal governments for as much as $15-billion in subsidies to restart construction on their electric-vehicle battery factory in Windsor, Ont.
In Quebec, General Motors Co. GM-N is partnering with South Korean battery material maker Posco Chemical Co. Ltd. PKX-N on a new cathode factory in Bécancour. Ford Motor Co. F-N announced last month that it is working with South Korea’s EcoProBM and SK On Co. Ltd. on a $1.2-billion plant that would produce electric-vehicle battery materials in that same city, backed by $644-million in public funding.
At an event Tuesday organized for the Volta announcement, Quebec Premier François Legault defended his government’s industrial strategy, saying the province is “not giving a gift” to anyone. Investments are made because the government calculates that the economic benefits will outweigh the amount of public backing provided, he said.
“New manufacturing plants will be announced in coming years. And if we don’t incentivize them, they will be built elsewhere than Quebec,” Mr. Legault said. “It’s a mistake to think that it’s a good idea to do nothing and wait.”