- Canada gave Stellantis over CA$1 billion for Brampton jobs.
- GM stopped BrightDrop EV van output in Ingersoll, Ontario.
- Country wants to claw back hundreds of millions in aid.
Canada wants hundreds of millions of dollars back from Stellantis and General Motors after the two American automakers announced significant job cuts in the country. Industry Minister Mélanie Joly confirmed that Canada will seek to recover incentive funding from GM tied to its Canadian operations.
Talks between Canadian government officials and Stellantis have been ongoing since November, focusing on how and when the automaker might repay public funds. Canada provided more than CA$1 billion (approximately $731 million) to help Stellantis retool its Brampton, Ontario, facility and keep production within the country.
Read: Canada’s Furious As Stellantis Boss Gets Grilled Over Jeep Move
Despite that investment, Stellantis revealed last year that it would be moving Jeep Compass production from Brampton to a plant in Illinois. Joly has publicly stated that legal action remains on the table if repayment isn’t forthcoming.
“A lot of our support was linked to production, and therefore if there was no production, obviously there was no funding,” she said during a recent cabinet meeting.
The federal government is also eyeing repayment from GM, which recently scaled back operations in Ontario. The company canceled a third shift at its Oshawa assembly plant and halted production of its BrightDrop electric delivery vans in Ingersoll.
Joly said that, as a result, Ottawa will seek to recover a portion of the CA$260 million granted to keep GM’s operations going.
Getting the Money Back Could be Hard
Whether the government can recover the money remains to be seen. According to Toronto lawyer Mark Warner, who spoke with The Wall Street Journal, recovering the funds could be difficult due to the structure of the loans and payouts.
“Recovering funds from the companies can be seen as an aggressive response with an air of finality that governments traditionally want to avoid in order to preserve a chance for continuing investment,” he told the newspaper.
While Canada has been stung by Stellantis and GM, it’s looking to the future. Not only is it hopeful that a new trade deal with China could encourage Chinese brands to build cars locally, but it also wants to convince Hyundai and VW to do the same.
