Canada Lands Volkswagen Battery Plant With Billions in Subsidies

After the initial announcement last month, Pierre Poilievre, the leader of the opposition Conservative Party of Canada, criticized the government for subsidizing Volkswagen.

“This money belongs to Canadians,” he wrote on Twitter. “Not to a foreign corporation. Not to Justin Trudeau.”

But Andreas Schotter, an associate professor of international business at Western University in London, Ontario, and a former financial executive with Volkswagen North America, said subsidies were the reality for countries seeking to maintain their automotive industries.

“It’s a good thing, but with a high risk,” he said, noting that policy shifts, particularly in the United States, could slow the transition to electric vehicles or that other technologies, like hydrogen fuel cells, could dislodge batteries over time.

While St. Thomas, which is midway between Detroit and Toronto, is in the center of Canada’s automotive corridor, it is a considerable distance from Volkswagen’s North American factories in Tennessee and Mexico. It is, however, just down the road from a factory where General Motors recently began building electric delivery vans and a Toyota factory that makes hybrid crossovers.

Over time, Dr. Schotter said, the new factory may end up supplying batteries to other companies.

Article source: https://www.nytimes.com/2023/04/21/business/energy-environment/volkswagen-battery-canada.html