In face of tax credit, Canadian electric vehicle makers look to U.S. to build
Global News
Montreal manufacturer Lion Electric Co. has big plans to ramp up production in the U.S. with a plant in Illinois with a capacity of 20,000 vehicles per year.
Damon Motors Inc. likes to refer to its electric motorbikes as groundbreaking, but the company’s manufacturing plans are also bucking a trend among Canadian companies.
It’s one of numerous electric-vehicle companies that have emerged in Canada as the push toward emission-free driving accelerates, but unlike most others, it plans to export the majority of the vehicles it will start producing in Surrey, B.C., next year to markets in the U.S. and Europe.
Company founder and chief executive Jay Giraud said the lack of tariffs on exports to the two regions was a key consideration for building in Canada, as was the ability to build near their research and development team.
“As a young company, it’s really important that our R&D and manufacturing are co-located.”
Other Canadian electric vehicle companies have also built up manufacturing plants close to home, but increasingly are looking to expand production in the United States as protectionist policies and other pressures help increase the trend toward building where one sells.
“There really is a relationship between where you build and where you sell and that’s particularly the case for EVs,” said Joanna Kyriazis, senior policy adviser at Clean Energy Canada.
“The batteries for EVs are very big. They’re heavy and expensive and logistically challenging to transport over long distances. So as the global auto industry transitions to EVs we are seeing more regionalization or localization of supply chains.”
To improve domestic production, experts like Kyriazis are pushing for more buyer incentives, both on the personal vehicle side and commercial, as well as other government support programs.