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Stellantis Chief Operating Officer Mark Stewart (left) and the head of LG Energy Solution's advanced automotive battery division, Kim Dong-myung, pose for a photo at the ceremony announcing their joint venture to build an electric vehicle battery plant in Ontario, Canada, on March 23, 2022. (LGES) |
LG Energy Solution Ltd. said Thursday its joint venture with Stellantis N.V. has reached an agreement with the Canadian governments on the terms of subsidies for the construction of its electric vehicle battery plant in Ontario.
The binding agreement puts the construction of the battery module manufacturing facility in Windsor back on track immediately, the companies said, about two months after they suspended the project over a delay by the Canadian federal and local governments in setting the conditions for the government incentives that would align with the US Inflation Reduction Act.
"We are pleased that the federal government, with the support of the provincial government, came back and met their commitment of leveling the playing field with the IRA. This collective effort enabled the deal to close, and we are now resuming construction on the site in Windsor," Mark Stewart, Stellantis' chief operating officer for North America, said in a release.
"We are happy to finally move forward with building the country's first major battery plant and be a central part of the local battery ecosystem," said Kim Dong-myung, president and head of LGES' advanced automotive battery division.
In May, LGES and Stellantis said they had halted the construction of the battery module factory amid apparent haggling between the Canadian federal and provincial governments over who should pay more incentives.
While the battery cell plant was still under construction, the decision put the brakes on what will be a more than 4.8 trillion-won ($3.6 billion) joint venture between the world's second-largest battery producer and No. 4 automaker.
LGES and Stellantis launched their joint venture, NextStar Energy, in March last year, to build an EV battery manufacturing plant with an annual production capacity of 45 gigawatt hours.
The Ontario plant aims to be completed in the first half of 2024.
The output from the Ontario plant will be supplied to Stellantis assembly plants in the area, which manufacture its famous brands, such as Chrysler and Jeep SUVs. (Yonhap)
