The Windsor region was boldly thrust into the future of an electrified auto industry Wednesday with the announcement that Stellantis and LG Energy Solution will build a $5 billion automobile battery plant on the city’s east side that will directly employ 2,500 people.
Canada’s first giga factory — producing at least one million watts of power — will cover 4.5 million square feet, making it slightly larger than Stellantis’s Windsor Assembly Plant, and is the largest investment in the history of the Canadian auto industry.
The plant will be located on 220 acres (88 hectares) at the corner of EC Row Avenue and Banwell Road and extends south up to the Canadian Pacific Railway tracks.
“We’re going to be manufacturing in the Windsor region hundreds of thousands of batteries for the whole North American ecosystem for Stellantis – this is huge,” said federal minister of innovation, science and industry Francois-Philippe Champagne.
“With this type of investment, you know they’re going to be here for decades to come.
This investment is similar to going from the horse-and-buggy era to internal combustion engines
“The best thing is this morning I was having breakfast with the folks from LG and we’re already talking about an expansion. They’re already thinking, what more can we do?”
In addition to the 2,500 direct jobs, it’s expected the spinoff jobs in the supply chain will be four to seven times that amount.
The magnitude of the announcement could be measured in the number and significance of the collection of local, provincial and federal leaders, as well as business and community representatives in attendance.
Prime Minister Justin Trudeau, who had planned to attend before being called away to a NATO meeting in Brussels, also sent a recorded message calling the plant an investment in the future of the country.
With the capacity to produce 45 gigawatts annually, the plant would be the largest of the 13 battery plants announced to begin production in North America by 2025.
“Attracting this multi-billion-dollar investment will secure Ontario’s place as a North American hub for building the cars and batteries of the future,” Ontario Premier Doug Ford said.
“As we secure game-changing investments, we’re also connecting resources, industries and workers in northern Ontario with the manufacturing might of southern Ontario to build up home-grown supply chains.
“Every region of Ontario will benefit with thousands of jobs being created and a stronger economy that works for everyone.”
Both the province and federal governments have committed hundreds of millions of dollars of incentives to land the plant.
Those figures weren’t released Wednesday for competitive reasons at the request of the companies.
Stellantis Chief Operating Officer for North America Mark Stewart said the plant would supply the company’s assembly plants across Canada and the U.S.
He expects construction to begin this summer with the first products being available in mid-2024. The plant will reach full operational capacity in 2025.
“It (Windsor) will supply 50 per cent of our (North American) volume,” said Stewart, who added the location of the company’s second battery plant in the U.S. will be announced shortly.
“There will be room for expansion. As we did our site selection, we made sure it was future proofed as well.”
Stewart said the company’s familiarity with the community and being home to Canada’s largest auto cluster were significant factors in Windsor being selected.
“This is one of the most storied areas of the company,” Stewart said.
“We have families in this community that are multigenerational. We feel putting the business here for our new joint venture is the right thing to do.
“Proximity is very good as well. From a logistics flow, it makes lots of sense.”
LG Energy Solution’s head of external affairs and government relations Denise Gray credited the aggressive pursuit of the plant by all levels of government for the region’s success.
It’s LG’s first major manufacturing plant in Canada.
“Windsor has offered an amazing amount of capability from financial, from workforce to a spirit of really wanting to get it done that really attracted LG Energy Solutions to select Windsor,” Gray said.
The announcement secures a key pillar in the Windsor region’s economic development strategy to fully exploit the auto industry’s electrification.
“It’s a five-year overnight success story,” said Invest WindsorEssex CEO Stephen MacKenzie, whose organization began putting the pieces in place in 2017 to transform the region into Canada’s automobility capital.
“Everyone in our local ecosystem played an important role. This region has landed a foundational piece for its future.”
The city’s role was to assemble the land for the site, which wasn’t initially on the market. There’s one residential lot the city is still negotiating to acquire.
The land acquisition is expected to cost $40 million to $50 million.
The other parcels were owned by Solcz Group Inc., Windsor Utilities Commission, CS Wind Canada Inc., Pointe East Windsor Ltd and a related numbered company. The city already owned four pieces of the property puzzle.
Council unanimously approved the land acquisition plans in an in-camera meeting on Monday.
The city will also offer tax breaks under its Community Improvement Plans that will see the site taxed at current agricultural rates for the first 20 years and will chip in about $8 million for mostly site-related preparations. One site improvement is moving an open drain that crosses the middle of the property.
“This investment is similar to going from the horse-and-buggy era to internal combustion engines,” said Windsor Mayor Drew Dilkens.
“It’s that big. It’s transformational.”
The speed at which this deal evolved reflects the pace of the electric revolution consuming the auto industry.
The companies first contacted Invest WindsorEssex on Feb. 11, 2021, less than a month after Stellantis was formed by the merger of PSA Group and Fiat FCA. By early January 2022 Stellantis, the world’s fourth largest automaker, informed the city it was favouring locating in the area over competition from other Ontario municipalities and U.S. states.
“For a deal this size, this has moved very rapidly,” said Invest WindsorEssex’s director of business attraction Joe Goncalves, who spearheaded the organization’s pursuit of a battery plant.
“We had to make the sale of the area to the companies first, then the government incentives came into play.”
The companies began serious interaction with city officials only days after Stellantis announced its intention to build two North American battery plants during its EV Day on July 8, 2021.
Stellantis will oversee construction of the plant while LG Energy Solutions will handle its operations.
Goncalves said representatives from the companies visited the area four times between July 2021 and the end of October.
He added a big plus for Windsor was having the infrastructure, such as sewer capacity and wastewater management, already in place at the site and a reliable source of clean energy.
Among the key infrastructure improvements being added are Ontario Hydro’s new transmission line to the area and Enbridge Gas upgrading its delivery capacity. Those improvements are also vital to the region’s burgeoning greenhouse industry.
“What we’ve learned in this is you have to have all the pieces in place before these companies come calling,” MacKenzie said.
“We invested in experts, did the research on what successful jurisdictions had done and had the necessary data ready.
“When we got the lead on this one from the federal development agency, we were able to send a complete package to the company within 12 hours.”
It was also made quite clear that Wednesday’s announcement is only the beginning of more positive news for southwestern Ontario.
Champagne said he’s already focusing on securing companies to build the foundation for an entirely new segment of the domestic automotive supply chain.
“LG is looking to expand enormously in North America,” Gray said. “We feel these are awesome opportunities for investment.
“We’re hoping to continue to develop supply chains and the closer we can get it to where we are the better.”
TORONTO – Roots Corp. may have built its brand on all things comfy and cosy, but its CEO says activewear is now “really becoming a core part” of the brand.
The category, which at Roots spans leggings, tracksuits, sports bras and bike shorts, has seen such sustained double-digit growth that Meghan Roach plans to make it a key part of the business’ future.
“It’s an area … you will see us continue to expand upon,” she told analysts on a Friday call.
The Toronto-based retailer’s push into activewear has taken shape over many years and included several turns as the official designer and supplier of Team Canada’s Olympic uniform.
But consumers have had plenty of choice when it comes to workout gear and other apparel suited to their sporting needs. On top of the slew of athletic brands like Nike and Adidas, shoppers have also gravitated toward Lululemon Athletica Inc., Alo and Vuori, ramping up competition in the activewear category.
Roach feels Roots’ toehold in the category stems from the fit, feel and following its merchandise has cultivated.
“Our product really resonates with (shoppers) because you can wear it through multiple different use cases and occasions,” she said.
“We’ve been seeing customers come back again and again for some of these core products in our activewear collection.”
Her remarks came the same day as Roots revealed it lost $5.2 million in its latest quarter compared with a loss of $5.3 million in the same quarter last year.
The company said the second-quarter loss amounted to 13 cents per diluted share for the quarter ended Aug. 3, the same as a year earlier.
In presenting the results, Roach reminded analysts that the first half of the year is usually “seasonally small,” representing just 30 per cent of the company’s annual sales.
Sales for the second quarter totalled $47.7 million, down from $49.4 million in the same quarter last year.
The move lower came as direct-to-consumer sales amounted to $36.4 million, down from $37.1 million a year earlier, as comparable sales edged down 0.2 per cent.
The numbers reflect the fact that Roots continued to grapple with inventory challenges in the company’s Cooper fleece line that first cropped up in its previous quarter.
Roots recently began to use artificial intelligence to assist with daily inventory replenishments and said more tools helping with allocation will go live in the next quarter.
Beyond that time period, the company intends to keep exploring AI and renovate more of its stores.
It will also re-evaluate its design ranks.
Roots announced Friday that chief product officer Karuna Scheinfeld has stepped down.
Rather than fill the role, the company plans to hire senior level design talent with international experience in the outdoor and activewear sectors who will take on tasks previously done by the chief product officer.
This report by The Canadian Press was first published Sept. 13, 2024.
Companies in this story: (TSX:ROOT)
The Canadian Press. All rights reserved.
VANCOUVER – Mediated talks between the union representing HandyDART workers in Metro Vancouver and its employer, Transdev, are set to resume today as a strike that has stopped most services drags into a second week.
No timeline has been set for the length of the negotiations, but Joe McCann, president of the Amalgamated Transit Union Local 1724, says they are willing to stay there as long as it takes, even if talks drag on all night.
About 600 employees of the door-to-door transit service for people unable to navigate the conventional transit system have been on strike since last Tuesday, pausing service for all but essential medical trips.
Hundreds of drivers rallied outside TransLink’s head office earlier this week, calling for the transportation provider to intervene in the dispute with Transdev, which was contracted to oversee HandyDART service.
Transdev said earlier this week that it will provide a reply to the union’s latest proposal on Thursday.
A statement from the company said it “strongly believes” that their employees deserve fair wages, and that a fair contract “must balance the needs of their employees, clients and taxpayers.”
This report by The Canadian Press was first published Sept. 12, 2024.
The Canadian Press. All rights reserved.
MONTREAL – Travel company Transat AT Inc. reported a loss in its latest quarter compared with a profit a year earlier as its revenue edged lower.
The parent company of Air Transat says it lost $39.9 million or $1.03 per diluted share in its quarter ended July 31.
The result compared with a profit of $57.3 million or $1.49 per diluted share a year earlier.
Revenue in what was the company’s third quarter totalled $736.2 million, down from $746.3 million in the same quarter last year.
On an adjusted basis, Transat says it lost $1.10 per share in its latest quarter compared with an adjusted profit of $1.10 per share a year earlier.
Transat chief executive Annick Guérard says demand for leisure travel remains healthy, as evidenced by higher traffic, but consumers are increasingly price conscious given the current economic uncertainty.
This report by The Canadian Press was first published Sept. 12, 2024.
Companies in this story: (TSX:TRZ)
The Canadian Press. All rights reserved.
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