In the News April 14
Government Handouts in the Name of “Greening the Economy”
Canada’s First Electric Vehicle Battery Plant to Be Built in Ontario
A big new pay-the-rich project involved with “greening the economy” was announced at a media event on March 23 in Windsor by Ontario premier Doug Ford, two federal cabinet ministers and the mayor of Windsor, Drew Dilkens. Also participating in the announcement were Mark Stewart, Chief Operating Officer for North America of the Netherlands-based global auto monopoly Stellantis and representatives of the giant south Korean conglomerate LG Group.
In a joint press release the companies stated: “Stellantis N.V. and LG Energy Solution (LGES) today announced they have executed binding, definitive agreements to establish the first large scale, domestic, electric vehicle battery manufacturing facility in Canada. The joint venture company will produce leading edge lithium-ion battery cells and modules to meet a significant portion of Stellantis’ vehicle production requirements in North America.” The statement pointed out that all three levels of government had agreed to support their joint venture.
The project, said to represent a total investment of around $5 billion has been called the largest private sector investment in Ontario’s history and the largest ever in Canada’s auto industry. LG will reportedly own 51 per cent of the joint venture and operate the new factory, slated to be one of the largest automotive battery plants in the world. Formed in 2021 by the merger of the Italian-U.S. conglomerate Fiat Chrysler Automobiles (FCA) and Peugeot SA (PSA) of France, Stellantis currently produces the Chrysler Pacifica, Grand Caravan and Voyager minivans at its Windsor Assembly Plant. It has another assembly plant in Brampton, Ontario that produces Dodge Chargers, Dodge Challengers, and Chrysler 300s. LG does not currently have any manufacturing operations in Canada.
Construction of the 4.5 million square foot factory is to begin this year on a greenfield site on the city’s outskirts. The goal is to have it begin operations in 2024 and to be fully operational by 2025, by which time the owners say it will employ 2,500 workers and have the capacity to produce battery cells and modules for over 500,000 electric vehicles per year. Stellantis says its target is for 50 per cent of its U.S. and Canadian sales to be electric by 2030.
The amount of government funding it took to land the plant in Windsor was not revealed, but is in the hundreds of million dollars according to Premier Doug Ford. Both Ford and federal Minster of Economic Development, Job Creation and Trade Francois-Philippe Champagne declined to divulge the exact figures, saying it would compromise ongoing negotiations to finalize the deal and to attract other companies.
The Windsor Star unofficially reported that the City of Windsor will contribute close to $150 million in the form of foregone lease revenue on land it has been accumulating for the site of the new factory, expected to cost it up to $50 million; development charge waivers; property tax breaks for the first 20 years; plus a number of infrastructure projects it has committed to undertake as part of site preparation.
Flavio Volpe, president of the Automotive Parts Manufacturers Association, said that while government spending in the auto sector typically ranges between 10 and 20 per cent, the amount being given to LG and Stellantis represents about 2 1/2 times what is typically put into an assembly plant.
Beyond the funds being provided by the three levels of government, the University of Windsor and St. Clair College are organizing to provide their services as well in terms of training, with new courses and programs, and facilities for carrying out research tailored directly to the what the companies say they need.
Supply Chain for Batteries to Start with Northern Ontario Critical Minerals
In announcing their funding of the EV battery plant, federal and provincial government representatives placed great emphasis on Canada and Ontario’s ability to supply all the critical minerals needed to produce the batteries.
Federal Industry Minister Francois-Philippe Champagne said Canada was the only nation in the Western hemisphere with the capacity and the materials to transform cobalt, graphite, lithium and nickel into the batteries needed to power electric vehicles. Ontario Minister of Economic Development, Job Creation and Trade Vic Fedeli made a point of saying all those minerals can be found in Northern Ontario.
Speaking on March 25 to mining company representatives in North Bay in his home riding of Nipissing, Fedeli told of the “spectacular” seven days he spent with the premier learning about the resources in the North just before heading to Washington to pitch Ontario as “a safe and reliable jurisdiction for investment and business,” and then to Windsor:
“We began in Thunder Bay and we drove to Impala Mine in Lac des Iles, about 90 miles from Thunder Bay . We went to Washington and spoke to Americans about our critical minerals and then we capped it off in Windsor, where we announced the single largest investment in the auto sector in the history of Canada. Both the critical mineral strategy, which talks about how we’re going to ethically extract minerals from the ground faster, safer and get them to market and the electric vehicle batteries, the plant in Windsor is where those minerals are needed – the lithium, nickel from Sudbury, processing of cobalt in Cobalt is going to be needed and the graphite in Hearst. All these rare earth minerals in the Ring of Fire, all of these mines need to be aggressive open (sic) to satisfy not only the world’s demand for electric vehicle batteries, but our own demand.”
In announcing its “Critical Minerals Strategy” on March 17 the Ford government said its aim was “to better connect the mines in the north with the manufacturing sector in the south, in particular to Ontario-based electric vehicle (EV) and battery manufacturing; tap into new and growing markets, including electric vehicles, batteries, telecommunications and national defence; and secure Ontario’s place in the global supply chain for decades to come.”
The statement made reference to “geopolitical forces fueling a surging demand for reliable sources of critical minerals in international and North American markets” and quoted Northern Development, Mines, Natural Resources and Forestry Minister Greg Rickford saying, “We want the world to know that Ontario is ready to supply our allies with a reliable source of critical minerals.”
First Nations Sovereignty and Jurisdication Bypassed in Aggressive Push to Open Mines
The minerals in question, however, all all lie beneath Treaty 9 territory, which covers a substantial part of northern Ontario, including the entire Hudson Bay coast. Draft terms of reference for a regional assessment of the Ring of Fire area drawn up by the federal Impact Assessment Agency of Canada did not call for representation by First Nations governments on a committee proposed to carry out the assessment. This prompted five Treaty 9 Chiefs to write the Minister of the Environment and Climate Change Steven Guilbeault in January to denounce the “harmful and dishonourable course” his department had embarked on. They said, “There is far too much at stake to allow First Nations to be shuffled to the side again. We will not accept mere ‘participation’ in a unilateral, top-down, Crown-led process that ignores our jurisdiction, laws, and responsibilities. Anything less than equal partnership in the development, implementation and enforcement of a robust [Regional Impact Assessment] will not be enough to ensure this critical investigation and decision-making tool will be done right.”
Last month the Ontario government went ahead and issued eight mineral exploration permits to Noront Resources for the Ring of Fire region over the objections of the James Bay Cree community of Attawapiskat and others who have repeatedly asserted their treaty rights and inherent jurisdiction over the area. On March 7 Chief David Nakogee wrote to the exploration direction to say that no mining activity, exploratory or otherwise, should occur until a First Nations-led probe has studied the potential environmental impacts across the entire Ring of Fire tract.
“Attawapiskat First Nation is aware that the western worldview in which you operate has great difficulty understanding cumulative impacts because it is too linear and fragmented and fails to consider the lands in a holistic and circular manner, as we do,” he wrote. “However, your difficulty in understanding our perspective is not an excuse to fail to address our concerns.” In a separate letter to Steven Guilbeault Chief Nakogee wrote, “The effect of Treaty 9 was to allow the Crown and settlers (Canadians) to share our land. It did not give Canada or Ontario the right to make unilateral decisions about the how our lands and lives may be destroyed.”
1. In March the federal and Ontario governments announced they were providing over $263 million to Honda to retool its Alliston plant to build hybrid vehicles. In February the Ontario government announced it was giving $500 million in loans and grants to ArcelorMittal Dofasco to make its steelmaking process in Hamilton “greener,” with Premier Doug Ford saying “clean steel” was a critical ingredient for electric vehicle production.
(With files from Windsor Star, CBC, Financial Post, Sault Star, APTN)
Workers’ Forum, posted April 14, 2022.