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News

GM, POSCO to build new battery-material plant in Quebec, charging up Canada’s EV prospects

General Motors and South Korea’s POSCO Chemical are starting construction immediately on a $500-million battery-materials plant in Bécancour, Que. It will open in the first quarter of 2025 and supply cathode material to plants in Lordstown, Ohio, and Spring Hill, Tenn., for Ultium, a GM joint venture with LG Energy Solution.

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GM, POSCO to build new battery-material plant in Quebec, charging up Canada’s EV prospects

By Anita Balakrishnan
Two electric vehicles getting charged at the General Motors plant in Oshawa, Ont., in November 2018. Photo: Lars Hagberg/AFP via Getty Images
Mar 7, 2022
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General Motors and South Korea’s POSCO Chemical are starting construction immediately on a $500-million battery-materials plant in Bécancour, Que. It will open in the first quarter of 2025 and supply cathode material to plants in Lordstown, Ohio, and Spring Hill, Tenn., for Ultium, a GM joint venture with LG Energy Solution.

It’s the second big battery-hub announcement for Bécancour, after the Germany chemical company BASF announced a plant there last week. 

What’s in it for GM: The Detroit automaker has said it will debut 30 new electric-vehicle models globally by 2025 and make one million of them in North America. It wants most of the economic value for those cars to come from North American-made parts, and this plant will provide a “key” cathode material that comprises about 40 per cent of a battery’s value. 

GM Canada said the plant will link with the local mining sector to refine nickel. It’s also close to the electric BrightDrop van plant in Ontario. The company said it chose Quebec for its educated workforce, multi-modal logistics hubs, spacious manufacturing sites with room to expand and predictable environmental standards thanks to hydro power.

What’s in it for Canada: GM’s investment in Canada’s EV supply chain may reassure the local auto sector, which has been under threat by proposed U.S. incentives to promote stateside EV manufacturing. Producing battery materials—but not the final batteries—could be a strategy to capitalize on growing demand while avoiding the uncertainty around the U.S. bill, which is focused on battery cells and final assembly.

What’s in it for Quebec: The plant will employ about 200 workers, returning jobs to the province 20 years after GM stopped making Chevrolet Camaros and Pontiac Firebirds there. 

What we’d still like to know: With everything going on in the U.S., could this ever lead to a bigger battery cell plant in Canada down the line? GM’s next plant is already slated for the U.S., but federal or provincial officials have met with manufacturers like CATL, LG and Tesla. Industry Minister François-Philippe Champagne said in a press conference Monday there will be news on other EVs to be built in Canada, and that he conveyed Canada’s advantages for battery manufacturing both in a recent visit to German automakers and to a Japanese delegation on Friday. 

Still, the governments haven’t formally announced how much this will cost taxpayers, since the federal and Ontario governments have already fronted $295 million each for Ford’s EV plants. Federal officials did not respond to The Logic’s request for comment by deadline. Quebec’s innovation ministry said the provincial government hasn’t announced a figure as discussions are ongoing.

The takeaway: Landing EV manufacturing commitments has become a key economic challenge for Canada, where the auto sector contributed $12.5 billion to the economy in 2020. 

Major automakers like GM and Ford support nearly 700 smaller suppliers. As Canada aims to ban sales of new internal-combustion light vehicles by 2035, time is of the essence to transition that workforce with new EV supply-chain opportunities.

#autos #batteries #electric vehicles #GM #Quebec

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