ARKANSAS, Sept 29 (Future Headlines)- Quebec, the sprawling Canadian province known for its abundant critical mineral resources, is poised to become a global leader in the electric vehicle (EV) supply chain. The province is in advanced negotiations with battery manufacturers and automobile companies to secure approximately C$15 billion ($11 billion) in investments over the next three years. This ambitious endeavor aims to bolster Quebec’s position as a premier destination for building EV supply chains, driven by its rich mineral resources and strategic location.
Investissement Quebec, the government-owned investment company, is at the forefront of Quebec’s push to establish itself as a key player in the EV supply chain. Guy LeBlanc, CEO of Investissement Quebec, revealed that the province has been successful in securing C$15 billion in investments over the past three years, and another C$15 billion is anticipated over the next three years. This concerted effort underscores Quebec’s commitment to diversifying supply chains for automakers and forging reliable partnerships with global companies, with Canada as their preferred destination.
“When Quebec was putting together a plan for being a leader in North America for battery metals, it was not known as a destination for car manufacturing or making auto parts,” LeBlanc noted. Instead of following conventional routes, Quebec decided to capitalize on its inherent strengths and develop a strategy focused on promoting its critical mineral resources, particularly lithium, nickel, and graphite.
Over the past three years, Quebec has successfully attracted investments from leading auto and battery manufacturers, solidifying its reputation as an EV supply chain hub. Companies such as General Motors, POSCO, and Ford Motors have chosen Quebec as a strategic investment location. The most recent announcement came from Swedish battery maker Northvolt, unveiling plans to construct a $5.2 billion facility in the province.
The appeal of Quebec extends beyond its mineral wealth. The province’s investment-friendly policies, skilled workforce, robust infrastructure, and proximity to the North American market have been significant factors in attracting global industry giants. The Northvolt investment, for example, was facilitated through subsidies and support from the Canadian and Quebec governments, further underlining the commitment to develop the EV supply chain.
Canada, with its vast natural resources and stable political environment, has emerged as a credible alternative for Western automakers and battery manufacturers aiming to diversify their supply chains. Reducing dependency on China, which currently dominates the EV supply chain, is a priority for these companies. To incentivize investments, the Canadian government has offered substantial subsidies, totaling C$28.2 billion, to automakers like Stellantis and Volkswagen.
For Northvolt’s recent investment in Quebec, the Canadian government provided C$2 billion in subsidies, complemented by loans, equity, and tax credits from the Quebec government. These incentives serve as catalysts for companies looking to establish or expand their presence in Canada.
The diplomatic tensions between Canada and China, ignited by the arrest of a Huawei executive in British Columbia in 2018, had significant repercussions in the critical minerals sector. Chinese investments in this sector came to a halt, leading to the acquisition of Chinese-owned equity by U.S., Australian, and Quebec government entities.
Investissement Quebec’s Guy LeBlanc revealed that while the province did not actively seek investments from Chinese companies in its recent initiatives, it did receive proposals from Chinese firms collaborating with European or American counterparts. This shift indicates a broader trend of North American partnerships emerging as viable alternatives to China’s dominant presence in the critical minerals and EV supply chain.
Quebec’s ambitious pursuit of a prominent role in the EV supply chain aligns with broader global efforts to transition to cleaner, more sustainable transportation solutions. As the world grapples with climate change and the urgent need to reduce greenhouse gas emissions, the EV industry has taken center stage.
By leveraging its abundant critical mineral resources and attractive investment environment, Quebec is positioning itself as a vital contributor to the global EV supply chain. The province’s commitment to this endeavor not only reinforces its role in sustainable development but also supports automakers’ aspirations to drive innovation, diversify their supply chains, and accelerate the transition to electric mobility.
Writing by Alireza Sabet; Editing by Sarah White