Premier Ford not worried about Volkswagen battery plant delay
Ontario Premier Doug Ford said Friday he is not worried about a two-year delay in the opening of a massive Volkswagen electric vehicle battery plant in southwestern Ontario.
PowerCo Canada, a Volkswagen subsidiary, said the delay at the $7-billion factory in St. Thomas, Ont., is due partially to a downshift in market demand on electric vehicles.
PowerCo also announced it has hired EllisDon as the general contractor for the next phase of construction. It said the delay will allow for next-generation battery technology while retaining the flexibility to scale over time as market conditions evolve.
Ford said he's confident that what is set to be Canada's largest electric vehicle battery plant will be completed and operational within a few years.
"I'm feeling good that they're building the fourth largest facility building in the entire world, 16 million square feet," Ford said.
"What would make me worried is if they said they aren't building, but they're building and it's going to be a massive, massive facility."
Economic Development Minister Vic Fedeli is equally as bullish on the project.
"To us it's a great news story the building is being built," Fedeli said. "The investment is being made and we're thrilled."
The plant was announced in 2023, with the federal government committing $700 million in upfront capital costs to build the factory and Ontario kicking in $500 million. The two governments are providing $1.4 billion that includes some loans.
There are also upward of $13 billion in government subsidies tied to production output on the table.
But opposition parties don't believe it's a good news story.
"There's no way that this is good news for people, this is not good news for workers who desperately need those jobs, for all the other spinoff industries that are relying on that, and also in a region which has already seen substantial layoffs," said NDP Leader Marit Stiles.
Liberal legislator Stephanie Smyth said she's worried the delay is a precursor to a shutdown.
"This is not, in our opinion, cause for celebration, but cause for concern," Smyth said.
"It seems like the writing's on the wall, there's a pattern here and we're watching it unfold once again."
Ford had a vision for an end-to-end electric vehicle supply chain that he aggressively pursued not long after winning his second term as premier in 2022. He envisioned critical minerals being mined and refined in northern Ontario and then shipped to battery plant facilities in southern Ontario.
But several manufacturers have since delayed or cancelled their plans.
Honda, which was set to build an EV battery plant and assemble electric vehicles in Alliston, delayed the project due to dwindling demand. Umicore put its plans for a cathode plant in eastern Ontario on hold. General Motors ended production of its BrightDrop electric delivery van in Ingersoll, and Ford delayed plans to build electric vehicles in Oakville in favour of its F-Series gas-powered pickup trucks.
Stellantis had launched a battery plant in Windsor with LG Energy Solutions, called NextStar. But NextStar Energy pivoted to storage batteries and LG has since bought Stellantis out of that operation.
The auto sector has also been hit hard by U.S. President Donald Trump's trade war with Canada.
This report by The Canadian Press was first published Sept. 25, 2026.
By Liam Casey | Copyright 2026, The Canadian Press. All rights reserved.