Volkswagen to operate first-ever North American electric vehicle plant in Ontario

Volkswagen and the Ontario government revealed a partnership by announcing the first-ever electric vehicle (EV) battery manufacturing facility in St. Thomas.

Negotiations were ongoing for just under a year before Volkswagen officials first met with Premier Doug Ford in December 2022.

In a joint statement issued after the press conference on Monday, François-Philippe Champagne, Canada’s Minister of Innovation, Science and Industry, and Vic Fedeli, Ontario’s Minister of Economic Development, Job Creation and Trade, cited the importance of the province becoming a global leader in the electric vehicle supply chain.

“Earlier today, Volkswagen announced that it has selected St. Thomas, Ont., as the location to build the company’s first overseas battery cell plant,” they said.

“[Monday’s] news is a major vote of confidence in Canada and Ontario and in our shared work to position the country and the province as a global electric vehicle supply chain leader.”

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Volkswagen has introduced its fleet of “ID.” electric vehicles, including the anticipated “ID. Buzz,” a spin on Volkswagen’s retro bus, which will have multiple seat configurations. That vehicle is set to hit the market in 2024, with pre-sales expected this year.

Both ministers said the partnership further highlights Canada’s evolving battery ecosystem and commitment to clean and sustainable energy.

“We will continue to build on this success by growing our EV ecosystem and supporting clean technology to create well-paying jobs and spur economic growth and prosperity for future generations.”

In late 2022, Environment Minister Steven Guilbeault advised that under new regulations, one-fifth of all passenger cars, SUVs and trucks sold in Canada in 2026 would need to run on electricity. By 2030, Guilbeault said that the mandate would hit 60 per cent of all sales, and by 2035, every passenger vehicle sold in Canada will need to be electric.

In the first six months of 2022, fully-electric and plug-in hybrid vehicle sales made up just 7.2 per cent of new car registrations. For all of 2021, the proportion was 5.2 per cent. In the third quarter of 2021, Statistics Canada said 5 per cent of total new vehicles registered in the country were zero-emission vehicles — up from 3.5 per cent in 2020.

At the time, Brian Kingston, president and CEO of the Canadian Vehicle Manufacturers’ Association, said the federal government should be building out the necessary infrastructure for electric vehicles before regulating sales, suggesting that Canada’s infrastructure was not on track to support a growing fleet.

With files from Mia Rabson of the Canadian Press