Government and Stellantis playing ‘high-stakes game’ with Windsor EV battery plant: Unifor

The union representing thousands of Windsor autoworkers says Stellantis and the federal government need to stop playing a “high-stakes game” that bets on the livelihoods of workers.

Concerns arose Friday after automaker Stellantis threatened “contingency plans” should Ottawa not fulfil its negotiation commitments to a deal that includes the Windsor electric vehicle battery plant, which is currently under construction.

Lana Payne, national president of Unifor, says both sides need to deliver on their promises. For the federal government, that means a commitment to make Canada an attractive place to invest in the EV sector. For Stellantis, it means a plant in Windsor that will provide more than 2,500 jobs in a city where the auto industry is a major employer.

“This is as serious as it gets right now. A company like Stellantis does not make decisions and then say, ‘OK, we’re just going to just quickly change our mind here.’ That is not the way this operates,” Payne said Saturday.

This all comes on the heels of Ottawa’s $13 billion offering to Volkswagen to build its plant in St. Thomas, Ont., which was announced last month. It was revealed last March that Ottawa’s contribution to the Windsor plant would be $500 million.

The discrepancy in the initial investments for both projects has been tied to legislation in the U.S.

The Inflation Reduction Act, introduced by the U.S. government a few short months after the Windsor plant was announced, promises billions over the next 19 years to incentivize companies to build EV plants on their soil, a competitive edge that played a role for the higher investment in Ottawa’s Volkswagen deal.

“The U.S. Inflation Reduction Act puts Canadian battery production at a significant disadvantage,” says Brian Kingston, the CEO of the Canadian Vehicle Manufacturer’s Association.

“Equivalent support is needed to level the playing field if Canada is going to be part of the emerging North American battery supply chain.”

“What I would say is that they all need to live up to their commitments,” Payne said. “Obviously things changed when the IRA was introduced in the United States last year. Everyone knew this. The federal government knew it too. And as a result, they sent a signal in their economic statement in the fall.”

Budget 2023 outlined the following: “… without swift action, the sheer scale of U.S. incentives will undermine Canada’s ability to attract the investments needed to establish Canada as a leader in the growing and highly competitive global clean economy. If Canada does not keep pace, we will be left behind. If we are left behind, it will mean less investment in our communities, and fewer jobs for an entire generation of Canadians. We will not be left behind.”

“The federal government knew they would have to step up in order to attract future investment to Canada after this huge incentive that the United States put on the table,” Payne said. “We have tens of thousands of members’ lives hanging in the balance right now. So yeah, I’m taking this very seriously and so should everybody else.”

Windsor mayor Drew Dilkens said in a statement Saturday morning that “the entire deal is now in question due to the federal government not fulfilling their commitments, jeopardizing not only the EV plant but also our efforts to attract additional investments in the region.”

Some voices are not as concerned, however, believing a formal agreement will be reached soon.

Flavio Volpe is the president of the Canadian Automotive Parts Manufacturers Association. He says the competitive nature of the landscape is one we can be confident in participating in.

“This is 100 per cent about the IRA and the battery tax credit,” he said. “The [Windsor] deal was signed right before the U.S. legislation. We’ve been expecting a revisiting of the terms since. There was always going to be [more] negotiation, we’re just seeing it happen in public right now.”

Volpe reiterated that to step out of this deal would not make sense for any of the parties involved and that this is simply a matter of everyone coming to the table.

“This [opportunity] is available in all 50 U.S. states without negotiation,” he said. “So for Canada, we have the extra challenge [of negotiating]. It’s not easy to win these investments, but the effort our federal government has put in for it means incredible wins: tens of thousands of jobs in the supply chain, tens of billions of dollars in annual purchases locally.”

“I believe we’re days away from [an agreement]. If we’re hearing about it now, it means we’re in the final strokes.”

Everyone’s committed to the project, MP says

Liberal Windsor-Tecumseh MP Irek Kusmierczyk says he’s been talking to François-Philippe Champagne, minister of innovation, science and industry, about the situation. He’s also confident a deal will be struck soon.

“To me there is no doubt that an agreement will get done and a battery plant will get built here in Windsor. All partners are absolutely committed to seeing this project through,” Kusmierczyk said.

“For us to be able to compete with the United States, we have to have all partners pulling together at the table, and I am confident that all partners see it that way. The federal government is leading this charge with historic investments we are bringing forward.”

When asked about Dilkens’ statement, Kusmierczyk recognized the weight behind the concerns.

‘Everybody’s got to get serious right now’

“This is the most important investment in the history of our community. It will really anchor the auto industry here for generations to come. So there is a lot at stake, but I want to reiterate, an agreement will get done.”

As for Unifor, Payne says a deal needs to be made as “quickly as possible.” Members of the union in Windsor woke up Saturday to the news that Stellantis may be reconsidering.

“We’ve been in constant contact with the company, with the federal government, and provincially, talking to the industry minister as well,” she said.

“Everybody’s got to get serious right now and come together and get this deal done. I don’t want to see this being dragged out right now. Companies start making decisions, and then we’re facing an uncertain future. It’s really too important not to get resolved.”