The parliamentary budget officer says it will take the federal government until 2043 to break even on its deals with Volkswagen as well as Stellantis and LG Energy Solution. An illuminated Volkswagen logo is seen on the back of one of the automaker's ID.4 electric vehicles at Fully Charged Live, an electric vehicle (EV), renewable and clean energy and urban mobility exhibition, in Vancouver, B.C., Friday, Sept. 8, 2023. THE CANADIAN PRESS/Darryl Dyck
OTTAWA – The parliamentary budget officer says it will take the federal government until 2043 to break even on its EV battery deals with two automotive giants.
The government announced subsidies for Volkswagen and Stellantis and LG Energy Solution this year to entice them to build electric vehicle battery plants in Canada.
The PBO says it will take 20 years for government revenues generated from the production of both plants to equal the production subsidies, which total $28.2 billion.
The budget watchdog’s calculation does not include any potential revenue that may be generated across the supply chain.
That’s in contrast to the federal government’s five-year break-even calculation for the Volkswagen deal, which includes expected revenue from production increases across the supply chain.
The federal government has not provided a break-even estimate for the Stellantis deal.
This report by The Canadian Press was first published Sept. 12, 2023.
