Asahi Kasei breaks ground on $1.7B manufacturing facility

Key Takeaways:

• Asahi Kasei is building a $1.7 billion lithium-ion battery separator plant in Port Colborne, marking Canada’s first facility of this kind. This significant investment is aimed at enhancing Ontario’s end-to-end electric vehicle (EV) and battery supply chain.
• Asahi Kasei has entered a joint venture with Honda Motor Co. to oversee the Port Colborne plant’s construction and operations. This collaboration aims to supply materials for approximately one million EVs annually by 2027, creating over 300 jobs in the region.
• Ontario has attracted over $45 billion in EV-related investments since 2020, securing its position as a leader in the EV industry. However, recent EV demand fluctuations have caused delays in some projects, including Umicore’s and Stellantis’ battery plants, highlighting potential volatility in the sector.

The Whole Story:

Multinational Japanese chemical company Asahi Kasei has begun work on a $1.7 billion manufacturing facility in Port Colborne to produce lithium-ion battery separators, a key component of electric vehicle (EV) batteries.

The new plant, the first of its kind in Canada, is a significant part of Ontario’s growing end-to-end EV and battery supply chain, accelerating the production of Ontario-made EVs.

“The start of construction on Asahi Kasei’s battery separator plant is a major step forward in building Ontario’s electric vehicle supply chain, connecting minerals in the north with electric vehicle battery makers and automakers across the province,” said Premier Doug Ford. “This facility will help lay the groundwork to produce electric vehicles from start to finish by Ontario workers with Ontario-made components, bringing better jobs and bigger paycheques to communities across the province.”

The start of construction closely follows the recent announcement of a joint venture between Asahi Kasei and Honda Canada Inc. that will be established to oversee construction and production activities at the Port Colborne plant.

Earlier this year, Honda announced plans to establish Canada’s first comprehensive electric vehicle supply chain with four new manufacturing plants including this separator plant in partnership with Asahi Kasei. With phase one expected to be complete in 2027, the separator plant is projected to produce enough material to supply approximately one million EVs annually and create more than 300 jobs in the region.

“Asahi Kasei’s investment in Ontario’s auto sector represents a clear vote of confidence in our province’s world-class workforce, dependable supply chains, competitive business environment and reliable clean energy,” said Vic Fedeli, Minister of Economic Development, Job Creation and Trade. “As our government continues to position Ontario as the epicentre of electric vehicle innovation, we look forward to seeing the partnership between Asahi Kasei and Honda come to fruition and bring economic growth and good-paying jobs to the Niagara Region.”

Since 2020, Ontario has attracted over $45 billion in EV and battery investments from companies including Honda, GM, Ford and Stellantis, along with key parts and component producers, helping to build-out the province’s end-to-end supply chain and solidifying the province as a leader in the EV sector.

However, the EV market’s recent slowdown has led to some setbacks. Umicore Rechargeable Battery Materials Inc. has delayed construction of its $2.7 billion battery component plant near Kingston, citing a decline in EV demand. Similarly, Stellantis temporarily halted construction on a portion of its EV battery plant in Windsor due to a dispute with the federal government over funding commitments.