Volkswagen Pushes Ontario Battery Plant Opening to 2029
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PowerCo Canada delays production at its $7-billion St. Thomas facility by two years, citing market demand and technology shifts.
PowerCo Canada, a subsidiary of Volkswagen, has delayed the start of production at its $7-billion electric vehicle battery plant in St. Thomas, Ontario, moving the expected opening date from 2027 to 2029.
According to reporting from CityNews Toronto and CBC News, the company stated the two-year pushback is intended to align the project with evolving market demand, technological advancements, and the Volkswagen Group's long-term strategy. Joel Karlsberg, chief procurement officer for PowerCo, told CityNews Toronto the decision is about "getting the pacing right" to protect the long-term investment and support regional employment. The company noted the delay allows for the integration of next-generation battery technology.
Despite the delay, PowerCo announced the appointment of Mississauga-based Canadian firm EllisDon Corp. as the general contractor for the facility's core infrastructure and structural work. St. Thomas Mayor Joe Preston told CBC News he remains confident in the project, noting that PowerCo already employs roughly 500 people in the area.
The project involves significant government backing. CityNews Toronto reports that the federal government committed $700 million in upfront capital, while Ontario provided $500 million. CBC News further notes a promise of up to $13 billion in federal subsidies. Initial estimates suggested the plant would generate 3,000 direct jobs along with tens of thousands of indirect roles.
The delay has drawn criticism from Conservative MP Andrew Lawton, who told CBC News the news is "disappointing" and questioned Volkswagen's commitment given the federal subsidies and job promises. The shift comes amid broader volatility in Ontario's EV sector; CBC News reports that General Motors halted production of the Chevrolet BrightDrop electric delivery van in Ingersoll in April 2025, and Honda cancelled a planned $15-billion EV plant in Alliston.