Battery sector: unlike Northvolt, Volkswagen’s Ontario mega-factory is ramping up

While uncertainty hangs over the timeline of Northvolt’s $7 billion plant in Quebec, which could be pushed back by one to two years, construction of Volkswagen’s mega-battery plant in St. Thomas, Ontario, is progressing smoothly with a view to producing its cells in 2027.

“The ramp-up of the St. Thomas mega-plant is on track. Site preparation is already complete,” the Newspaper a spokesman for PowerCo Canada, which is currently building it with German giant Volkswagen in neighbouring Doug Ford’s province.

“Our goal is to produce the first cells in 2027, followed by an acceleration of mass production depending on demand. The first concrete pour is planned for this fall,” they illustrate.

In the April 2023 plant announcement press release, it was mentioned that the plant would be completed in 2027 to produce batteries for one million electric vehicles per year. PowerCo assures that this timeline is still the right one.

Plans for Volkswagen’s St. Thomas, Ontario plant.

Provided by Volkswagen

While analysts such as Jefferies say Volkswagen could have to make $6 billion in cuts, in addition to closing some factories in Germany, the company, which is also a 22% shareholder in Northvolt, says it is sticking to its plans in Canada.

30,000 indirect jobs

Last year, The Journal had visited the community of 43,000 souls that managed to attract the factory, which is the size of 1,400 football fields, to its backyard.

The region was salivating at the idea of seeing the creation of 3,000 direct jobs and up to 30,000 indirect jobs.

At Newspaper, St. Thomas Mayor Joe Preston said “the site was exactly what they were looking for. The federal and provincial governments really helped us get our pitch out there.”

According to calculations by the Parliamentary Budget Officer (PBO), the agreement reached with the federal government for the Volkswagen plant amounts to $16.3 billion.

Let us recall that last February, The Journal reported that when Northvolt was in talks with Quebec and Ottawa to obtain billions of dollars in financial aid, the young Swedish company was experiencing delays and massive losses.