Two year delay in EV battery plant construction ‘nothing but good news’: Ford government
On Thursday, PowerCo Canada, a subsidiary of German automaker Volkswagen, announced it would delay the production of the $7 billion giga factory in St. Thomas, Ont. where the company was planning to produce electric vehicle batteries.
The two-year construction delay comes in the wake of other electric vehicle manufacturing investments also pulling up stakes, leaving much of the Ford government’s EV supply chain strategy up in the air.
Ahead of the cabinet meeting, Economic Development Minister Vic Fedeli — the architect of the EV strategy — called the construction delay “extremely exciting.”
“There are now shovels in the ground, a company has been hired and awarded contracts, there’s a $7 billion building and infrastructure being built there,” Fedeli said.
“To me, that’s nothing but good news.”
Fedeli added that full construction is expected to begin in a month, and that he expects the facility will be able to open ion 2029 as per the schedule.
Critics of the Ford government, however, argue that other plants have followed the same trajectory before eventually cancelling their investments altogether.
“We know Stellantis started with closing for retooling back in 2023 and then when 2025 came along and the tariffs hit, the retooling of that plant was delayed and a few months later we learned that the plant was being moved to Illinois,” said Liberal MPP Stephanie Smyth.
According to the government’s public accounts, Honda, NextStar, Toyota and General Motors received a combined $347 million over 2025-26 fiscal year, while the city of St. Thomas received $65 million for sewer and water connections for a new industrial park.
NDP Leader Marit Stiles said the government should be more transparent about whether strings were attached to taxpayer funding.
“Especially when we are heavily subsidizing big companies — and I’m not saying it’s not the right thing to do — but I think it’s very clear that we should know what those strings are, that there are strings attached, there are conditions and we understand what they are,” Stiles said.
Fedeli said much of the promised provincial funding was based on future production and won’t be awarded if batteries or vehicles don’t come off a manufacturing line.
Still, Fedeli offered optimism about the state of Ontario auto manufacturing sector.
“Toyota invest a billion two this year in January. We’ve seen General Motors invest $1 billion in St. Catharines and more of it for Oshawa. We’ve seen Stellantis hire a third shift. Ford will be opening a multi-billion dollar facility in a couple of months here in Ontario,” he said.
“So we see great movement in the auto sector as well.”
