General Motors (GM) has welcomed investments totaling $300 million CAD ($220 million USD) from the Canadian federal and Quebec provincial governments to support its battery material processing plant in Bécancour, Quebec. The plant, which will be operated as a joint venture between GM and Korea’s POSCO Future M, will produce Cathode Active Material (CAM) for Ultium batteries produced in the United States. The material, made up of lithium, nickel, manganese, and cobalt, represents about 40 percent of the total cost of a battery cell. This investment will help GM’s electric vehicles qualify for federal tax credits in the US, as the batteries in EVs must be manufactured in North America, and 80 percent of their critical materials must come from the US or a friendly country, including Canada.

The Canadian federal and Quebec provincial governments will each contribute $150 million CAD ($110 million USD) in support for the plant, amounting to $300 million CAD ($220 million USD), or roughly half of the cost of the plant. GM estimates that the plant will cost approximately $600 million ($441 million USD) and will open in 2025. Bécancour, Quebec is becoming a hub for battery material processing, with plans for plants from BASF and Vale related to battery materials in the city also announced.

Canada’s other provinces are also attracting battery plants. Volkswagen plans to build a gigafactory in southern Ontario, as did Stellantis. However, a conflict between it the provincial and federal governments over incentives recently prompted the automaker to put a pause on construction at the plant.