The Stellantis deal is in full swing again as the Trudeau government grapples with politics

article content

The Stellantis deal in Windsor is back in the air and it could spell trouble for thousands of Brampton auto jobs.

article content

No one comments on the record, but there’s a lot of talk behind the scenes about who is to blame, and once again most point to Ottawa.

article content

Last weekend it appeared an agreement had been reached, with the Ford government in Queen’s Park joining the Trudeau government in Ottawa in securing the Stellantis deal.

Stellantis halted work on its electric vehicle battery plant earlier this week. The reason given was that the Trudeau government had failed to keep promises made to the company. Rather than proceeding with work on the facility, the company said it was reviewing “emergencies,” which is another way of saying it is considering moving production to the United States.

The Biden administration in Washington is offering lucrative incentives in the form of Production credit for advanced manufacturinga tax break for companies that build batteries for electric vehicles, for example.

article content

article content

The Trudeau government promised to honor these incentives, but failed to do so when it came to Stellantis.

This led to Stellantis’ decision to halt construction. Why build here when the Americans offer more, and why build here when the government promises something and then doesn’t keep it?

Shortly thereafter, Stellantis stopped construction, the Trudeau government said the real problem is that Ontario is not paying its fair share for the deal. This sparked a PR war between Ottawa and Queen’s Park to get the Ford government to tone down its offer of Stellantis.

article content

The Ford government had offered Stellantis $500 million to secure the facilities, including money to upgrade infrastructure such as roads and ensure adequate power supplies. What they hadn’t done, and didn’t normally do, was comply with an American federal incentive, which the Canadian government normally does.

Determined to strike a deal, Ford agreed to Trudeau’s terms in exchange for other concessions, such as the government relaxing opposition to Ontario’s construction of Highway Hwy. 413 and supports the Ring of Fire plans to mine key minerals in northern Ontario.

According to sources close to Stellantis, the deal the federal government presented to the company was essentially the same deal as the previous one, with Ontario now bearing some of the federal burden.

article content

RECOMMENDED VIDEO

The Biden administration is offering companies a production credit of $35 per kilowatt hour for battery cells and an additional $10 per kilowatt hour for battery modules. The Trudeau government is only offering $35 for cells and is not doubling the additional $10 for modules, making the US a more lucrative place to manufacture the modules.

For Stellantis, that could be as simple as moving module production across the river to Detroit, or maybe somewhere deeper in the US. This would mean the loss of approximately 300 jobs at the Windsor plant once construction is complete, but would have had no impact limited to Southwest Ontario.

Some in the auto industry fear that if Stellantis shuts down its module plant, it will also shut down production at its Brampton auto assembly plant, which employs nearly 3,000 workers. This view is not shared by all stakeholders involved, but gives cause for concern.

article content

Prior to Stellantis’ announcement of expansion at Windsor, there were widespread concerns that the Brampton facility would close for good. The plant produced the Chrysler 300, Dodge Charger, and Dodge Challenger, but was due to switch to some sort of electric SUV in 2025 after a 2024 conversion.

RECOMMENDED VIDEO

Some automotive industry officials now believe this is uncertain as Stellantis assesses all eventualities.

Stellantis and Unifor, the union representing workers at all the plants involved, declined to comment when contacted on Friday. Requests for comment from various representatives of the Ford and Trudeau administrations were ignored.

Meanwhile, workers in Windsor and Brampton worry about their future.

Political games are being played, and once again it’s the people working the line who may be paying the price.