Regardless of a collection of unhealthy auto trade information in current weeks, Volkswagen says it is all methods go for the corporate’s plans to construct a large electrical automobile battery plant in St. Thomas, Ont. This week the corporate introduced foundations have been being poured for 3 buildings that collectively will kind the large, 850,000-square-foot plant northeast of St. Thomas. The plant being constructed by PowerCo, a subsidiary of Volkswagen, is on a hiring blitz with plans for the plant to help 3,000 staff as soon as manufacturing begins in 2027. The corporate’s chief hiring officer Norman Wickboldt was interviewed in a YouTube video by St. Thomas Financial Improvement lately, saying PowerCo has employed about 250 individuals, lots of them figuring out of the corporate’s short-term workplace in downtown St. Thomas. Wickboldt mentioned there ought to be 400 individuals working there by the 12 months’s finish, and hiring ramps up for store flooring staff, engineers and different positions within the new 12 months. “All people who’s considering working for PowerCo can positively contact us,” Wickboldt instructed the interviewer. “It may be an awesome place to work as a result of we provide nice job packages and have an interest within the long-term private growth of our staff.” WATCH | PowerCo hiring in St. Thomas: In distinction to the positivity are two information tales from earlier this month that recommend Canada’s auto manufacturing trade — and the electrical automobile trade specifically — are dealing with large challenges. Final week GM introduced they’d halt the manufacturing of electrical supply vans on the firm’s meeting plant half-hour away in Ingersoll. Whereas Stellantis is about to maneuver manufacturing of the Jeep Compass SUV out of its Brampton, Ont., meeting plant and into one other plant in Illinois. So are Volkswagen’s plans to construct the St. Thomas battery plant, supported by billions in taxpayer cash, nonetheless a good suggestion? Or will the present optimism surrounding PowerCo ultimately quick out, together with the BrightDrop GM plant in Ingersoll?
The pessimist’s view
Andreas Schotter, a professor of worldwide enterprise at Western College’s Ivey College and a former automotive trade government, places himself within the cynical camp. “We’re seeing sadly kind of the ultimate exodus of the North American mannequin of automotive manufacturing from Canada proper now. It’s unhappy,” Schotter instructed Tuesday. This photograph taken in 2022 reveals employee a GM’s CAMI meeting plant in Ingersoll, Ont. On the time the plant had retooled to supply the BrightDrop electrical supply automobile. Final week the corporate introduced they have been completely shutting down manufacturing of the supply van, leaving the way forward for the plant unsure. (Andrew Lupton/ ) Schotter sees plenty of challenges for VW’s plans for St. Thomas. Total, he mentioned the North American market and authorities insurance policies in Canada and the U.S. are not embracing EVs like they have been a couple of years in the past. He mentioned there proceed to be issues together with entry to charging infrastructure, questions on automobile vary, and the excessive value of EVs for cash-strapped shoppers. He factors to European cities, akin to London, England, which has a congestion tax for driving downtown with an exemption for electrical automobiles. There are related insurance policies in Germany, Sweden and different jurisdictions that basically force firms and shoppers to maneuver away from combustion-engine automobiles. Schotter mentioned that is not taking place on an identical scale in North America. “I am looking forward to the plant, however I’m nonetheless not betting my wage on it getting constructed,” mentioned Schotter. reached out to PowerCo for remark. One spokesperson mentioned they’d solely be capable to discuss concerning the begin of the plant’s building, not it is total viability or the elements affecting the EV trade.
A line of newly assembled BrightDrop supply automobiles exterior of GM’s CAMI meeting plant in Ingersoll, Ont. The corporate has stopped producing the electrical supply automobile, citing gradual gross sales. (Andrew Lupton/ )
Greig Mordue is a former auto trade government with Toyota who now teaches engineering as an affiliate professor at McMaster College.
He agreed it will not be straightforward for Volkswagen to make the plant viable, pointing to uncertainties with U.S. tariffs.
“The trade in North America shouldn’t be shifting practically as shortly as anybody anticipated,” he mentioned. “We threw our lot right into a expertise that represents about 5 per cent of the market. And now two years later, it’s nonetheless at that degree.”
Mordue mentioned Volkswagen has no selection however to proceed to tout the venture, regardless of challenges within the trade.
A extra optimistic view
Klaus Meyer is extra optimistic the plant shall be constructed. He factors out that assembling automobiles, and constructing batteries, are two very totally different ventures. He mentioned batteries produced on the St. Thomas plant will serve two current Volkswagen meeting crops, one in Chattanooga, Tenn., the opposite in Puebla, Mexico. Meyer mentioned with no different North American manufacturing of electrical automobile batteries, Volkswagen wants the St. Thomas plant. He pointed to all the federal government assist the corporate has had, not solely with monetary helps however in offering the land and fast-tracking the approval course of. “It could be very troublesome and costly to start out that from scratch at one other location,” mentioned Meyer. “It could take years of preparation in the event that they needed to do this some place else.” Entry to Ontario’s comparatively low cost electrical energy and water, each essential to large-scale battery manufacturing, are different causes Meyer mentioned makes the St. Thomas plant viable.
PowerCo has arrange a brief workplace in downtown St. Thomas. The corporate plans to start manufacturing at its battery plant in 2027. (Andrew Lupton/ )
St. Thomas Mayor Joe Preston additionally sees no indication that what’s occurred in Ingersoll or Brampton will have an effect on Volkswagen’s plans for his metropolis.
“What we hear is the sound of building tools and folks being employed for positions,” mentioned Preston. “On a regular basis I meet a brand new worker of PowerCo in downtown St. Thomas. It has a shiny future right here.”
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