Volkswagen delays $7B Ontario battery plant to 2029

Volkswagen has delayed the opening of its planned electric vehicle battery factory in St. Thomas, southwestern Ontario, by two years to 2029.

Its battery subsidiary, PowerCo Canada, said it is postponing production at the $7-billion facility to align timelines with changing market demand, technology advancements, and the automaker's long-term strategy. The company stated the revised schedule allows the integration of next-generation battery technology while keeping the flexibility to scale as conditions shift.

Joel Karlsberg, chief procurement officer for PowerCo, stated that the decision focuses on getting the pacing right to protect long-term investments and support regional jobs.

On September 24, PowerCo also selected Canadian construction firm EllisDon Corp. as the general contractor for the factory. The project will now move into its next construction phase, which focuses on core infrastructure and structural work.

The factory was first announced in 2023. The Canadian federal government committed $700 million in upfront capital costs, while the provincial government of Ontario pledged $500 million.