What could a scrapped EV mandate mean for Windsor’s NextStar battery plant?

NextStar Energy said it is moving towards battery cell production after calls to the feds to scrap EV target requirements. CTV Windsor’s Robert Lothian reports.

The potential scrapping of Canada’s electric vehicle mandate could create more uncertainty in the short term for Windsor’s NextStar Energy electric vehicle battery plant.

Earlier this week, automotive leaders asked the federal government to scrap its electric vehicle sales mandate.

“Now, what’s changed since it was designed and came into force is that we’ve had this collapse in EV sales,” Brian Kingston, the CEO of the Canadian Vehicle Manufacturers’ Association, said after a meeting with Prime Minister Mark Carney on Wednesday.

The meeting included the CEOs of Ford Canada, Stellantis Canada, and GM Canada.

Greg Layson, the Digital and Mobile Editor for Automotive News Canada, told CTV News the targets were always “ambitious.”

“With no zero emissions vehicle purchase incentives, it becomes more difficult to meet those targets from the government standpoint,” Layson said.

Potentially lowered EV production creates another hurdle to overcome for the NextStar battery plant.

Production of battery cells has been expected to begin at the plant later this year.

“We were never going to see three shifts of production at the battery plant on day one,” Layson said.

“We weren’t even going to see two shifts of production on day one. It was going to be a long, slow process. It might just be a longer, slower process.”

Previous estimates expected the battery plant to create about 2,500 jobs when fully operational.

NextStar Energy declined to comment on potential changes to the vehicle mandate. In a previous unrelated inquiry last week, the battery manufacturer noted about 850 employees have been hired so far.

“We’re not going to hire 2,500 workers overnight to fill this place. They’re going to hire shift at a time, fill what they need, work when they need to,” Layson added.

Under the EV sales mandate, 20 per cent of all new light-duty vehicles sold in Canada must be zero-emission as of next year. The target rises annually to 100 per cent by 2035.

Layson believes Canada could loosen the mandates and “spread” out the targets.

He’s optimistic the plant will play a key role in the EV sector when consumers transition, but it could take longer than expected. The automotive journalist added the industry will need better infrastructure and more competitive pricing to see demand take off.

“When sales fall, production falls, and when production falls, batteries aren’t needed,” he noted.

-With files from the Canadian Press.