By Canadian Press

Canada’s EV battery contract with Volkswagen could be worth more than $13 billion

Apr 20, 2023 | 11:22 AM

OTTAWA — German auto giant Volkswagen has secured an exclusive contract with Canada that could be worth more than $13 billion over the next 10 years to build an electric-vehicle battery plant in southwestern Ontario.

Volkswagen announced last month it had chosen the town of St. Thomas to build its first overseas gigafactory.

It was known that Canada and Ontario had both put money on the table to lure Volkswagen but until now neither have disclosed exactly how much.

Industry Minister François-Philippe Champagne today provided some of the details in an interview with Bloomberg News and The Canadian Press has verified the information.

The contract will include an upfront capital investment of $700 million and up to $13 billion in production subsidies for every battery they make and sell.

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The subsidies will not be in the form of tax credits but are designed to match what Volkswagen could have received had it chosen a site in the United States to build its new plant.

This report by The Canadian Press was first published April 20, 2023.

The Canadian Press