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May 16, 2022 07:04 AM

New Stellantis-LG battery plant in Windsor, Ont., can tap into existing suppliers

The skill sets of traditional auto players are perfectly suited to a range of vital inputs at the $5.2-billion plant

David Kennedy
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    LG Battery assembly line
    LG

    LG Energy Solution batteries are produced in Michigan, above. Some components for battery production will be outside the expertise of most auto suppliers, but their skill sets are still suited to a range of vital inputs at the new Windsor plant.

    As LG Energy Solution and Stellantis build out a supply chain for a massive new battery-cell plant in Windsor, Ont., auto parts makers will not be left on the outside looking in.

    Cathode material, copper foil and some other components will be outside the expertise of most auto suppliers, said Denise Gray, LG Energy’s head of external affairs and government relations for North America. But the skill sets of traditional auto players are perfectly suited to a range of vital inputs at the $5.2-billion plant.

    From metal tabs on the individual battery cell pouches to the aluminum, plastic and electronic parts needed to package cells into modules, the LG-Stellantis joint venture will be working to source components locally, Gray said.

    “Those are absolutely traditional automotive suppliers that can be a part of this industry,” she said.

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    Stellantis-LG $5-billion battery plant will 'create a new supply chain' in Canada

    Given the “logistical nightmares” created by COVID-19, LG Energy also looks to be the catalyst that attracts more companies in the battery supply chain to Canada, Gray said. The Canadian government and the Ontario and Quebec governments have made no secret about working to this same end, with all three jurisdictions courting investment to help establish an electric-vehicle supply chain running from material mining through to finished vehicles.

    Two cathode material plants were announced for Bécancour, Que., in March, but to date, Gray said, no decisions have been made about cathode or anode material suppliers for the Windsor plant. It’s  expected to open in 2024, occupying about 100 acres (40 hectares) of floor space, and ramp up to full production in 2025.

    BUILDING MOMENTUM

    Nearly three years of construction will give the wider ecosystem for both battery components and EV parts time to congeal in Windsor and the surrounding area, said Conrad Layson, a senior alternative-propulsion analyst at U.S.-based AutoForecast Solutions.

    “That ecosystem feeds on itself and builds out — it’s how Detroit got started,” Layson said.

    Along with parts suppliers, nearby tool-and-die shops, machine shops and automation companies can expect a steady stream of new business from the battery plant, said Brendan Sweeney, managing director of the Trillium Network for Advanced Manufacturing.

    “A plant that [large] requires a lot of repair and maintenance,” Sweeney said.

    Related Article
    Stellantis investing $3.6 billion in EV-focused assembly plants, R&D centres in Ontario

    According to its website, Trillium is a nonprofit organization that raises public and investor awareness of Ontario’s manufacturing capability.

    Local logistics companies in and around Windsor will also get a boost, said Michael Robinet, executive director of Michigan-based S&P Global Mobility Consulting.

    “The logistics of moving those batteries in and out is significant. These are not light,” Robinet said. “They require specialized transportation, specialized handling.”

    According to Stellantis, the plant will produce both individual lithium-ion cells and battery modules — made up of connected cells — that will then be shipped to assembly plants and fitted into finished battery packs.

    Gray declined to say whether the plant — which will be capable of producing cells to power 450,000 EVs a year, assuming 100 kilowatt-hour battery packs — will supply businesses other than Stellantis.

    SPINOFFS FOR SUPPLIERS

    Stephen MacKenzie, CEO of Invest WindsorEssex, said the agency is looking to attract new suppliers for the battery plant. But it also plans to work with existing parts makers to help them gain a foothold in the EV ecosystem.

    “We are planning workshops to help them make the transition; to help them identify future opportunities and the areas in need of investment.”

    In addition to wiring, metal and plastic parts that piece together battery modules, traditional parts suppliers can lend their expertise when modules are combined into battery packs.

    Battery-management systems, cooling systems and lightweight enclosures that shield fully assembled batteries from the elements are several examples of components that auto suppliers are likely to be called on to build.

    As with front-end modules for vehicles with internal-combustion engines, battery enclosures will typically be produced close to assembly plants, Robinet said.

    “You don’t want to be transporting something as large as a battery box hundreds of miles. You’re basically shipping air.”

    As suppliers cluster around the new Windsor battery plant, a network of EV makers focused on parts further downstream is likely to grow out from there, Layson said. He cited suppliers that build e-axles, electric-motor subassemblies and other parts with looser ties to EV batteries as likely to establish a presence in relative proximity.

    “With this battery plant in place,” Layson said, “it sets Windsor and the environs up for other key component manufacturers to look at Windsor in a new light.”

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